Novogratz teams up with Bloomberg on crypto index

Mike Novogratz, chief executive officer of Galaxy Investment Partners, speaks during the Reuters Global Investment Outlook Summit in New York, U.S., November 13, 2017. REUTERS/Andrew Kelly

NEW YORK (Reuters) - Galaxy Digital Capital Management LP, the cryptocurrency asset management firm founded by former macro hedge fund manager Mike Novogratz, launched an index on Wednesday in cooperation with Bloomberg to track performance of 10 virtual coins, the companies said in a statement.

The index, called Bloomberg Galaxy Crypto Index, will track some of the largest virtual currencies trading against the US dollar including bitcoin, ether, monero, ripple and zcash.

The index will be owned and administered by Bloomberg. It is weighted based on market capitalization of each coin and uses data sources vetted by the two firms, they said.

Galaxy and Bloomberg added that creation of the index reflects growing interest by their clients in the new asset class and would help the market improve.

“The Bloomberg Galaxy Crypto Index brings unprecedented transparency to the crypto markets,” Novogratz said.

Cryptocurrencies, of which bitcoin is the most valuable, are pieces of computer code that are not backed by any central bank or hard asset. Prices of cryptocurrencies rallied last year, spurring interest from some mainstream financial firms and prominent investors.

Novogratz, a former hedge fund manager at Fortress Investment Group and Goldman Sachs Group GS.N partner, has been one of the most outspoken advocates of cryptocurrencies on Wall Street.

He originally set out to launch a cryptocurrency hedge fund, but halted plans in December. Instead, early this year unveiled Galaxy Digital, a merchant bank focused on digital assets.

Reporting by Anna Irrera; Editing by David Gregorio