What should have been the most significant news of the year for the digital economy was glazed over by most media outlets, but Goldman Sachs' announcement with Coin Metrics and MSCI about launching a standardized classification system for digital assets, including cryptocurrencies, is more important than you think.
The new collaboration led by Goldman answers the call by digital finance investors, entrepreneurs and market participants of all types to have a consistent, unbiased system to rate, analyze and classify digital currencies and security tokens. Acting almost like a “Bloomberg” for digital assets, Datonomy will help retail and institutional investors better navigate and understand the worth and behavior of the more than 20,000 coins and tokens.
Anne Marie Darling, the Head of Marquee Client Strategy and Distribution at Goldman Sachs, stated, “Datonomy is a consistent and standardized way to help market participants view and analyze the digital assets ecosystem – giving them a better idea of what is going on in the different crypto spaces, such as DeFi and smart contact platforms.”
This is a Big Deal and Here’s Why:
As previously mentioned, there are more than 20,000 individual cryptocurrencies in existence today – well over three times more than the approximately 6,000 publicly traded US stocks. However, those same stocks have an overwhelming amount of analysts and ratings agencies watching their every move. In contrast, until the announcement from Goldman, there was no significant standardized, data-focused system to classify, analyze and report on the thousands of digital assets.
Now, instead of digital finance investors flying blind, there will be a consistent, neutral and reliable guide – providing the data and insight crypto and security token investors are waiting for.
More Institutional Participation Means More Progress and Legitimacy:
Goldman Sachs’ Datonomy is a fairly straightforward step in standardizing, and at the same time helping to reign in, the digital finance ecosystem. Moves like this continue to chip away at the “wild west” references to the market little by little. More institutional participation like this gives others the confidence to enter this growing market – creating a cascading momentum that only benefits the ecosystem as a whole. While all investors – retail and institutional – continue to wait for regulators to make moves and provide regulatory clarity, we’ll take these wins as they come.