Aquanow, a leading digital asset infrastructure company and crypto liquidity provider, introduced the Aquanow DeFi Funding Index (ADFI) and Aquanow DeFi Funding Rate (ADFR) as new benchmarks available on the Bloomberg Terminal. The liquidity-pool-value-weighted composites measure the performance of major decentralized finance (DeFi) lending protocols to serve as yardsticks for related fixed income investments.
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These benchmarks are our latest offering to help financial institutions operate in the digital economy. We’re thrilled to continue to help incumbent organizations transition to the world of #digitalassets
The benchmarks are the latest in Aquanow’s suite of solutions to help financial institutions operate in the digital economy. The standards capture an aggregate yield of stablecoin lending to selected DeFi pools and can be used in performance evaluation for active investment funds, spread analysis, and more.
The Aquanow DeFi Funding Index innovatively captures the idiosyncrasies of protocol-based lending markets for accurate risk and return attribution of capital deployed in these venues. The Aquanow DeFi Funding Rate is the weighted average spot rate across decentralized pools for lending non-algorithmic stablecoins. The interest rates of loans with other features can be assessed against the Aquanow benchmark to conceptualize their unique risks.
“As institutional adoption of digital assets grows, financial firms and investors need sophisticated, familiar, and trustworthy performance standards to understand and communicate sources of risk and return. We’re delivering that level of insight with these new benchmarks,” said Phil Sham, Co-Founder and CEO of Aquanow. “The supply and demand of capital in digital markets is affected by different variables than what impacts traditional arenas. Our indices factor in those subtleties and are built to inform institutions so they can confidently participate in this emerging landscape.”
To be eligible for inclusion in the benchmarks, DeFi protocols must meet strict criteria, including successful completion of third-party audits and having no history of unresolved breaches. The pool value, utilization ratio, and annual percentage yield of the protocols are also taken into consideration. To account for the rapid pace of change in digital asset markets, the index will be rebalanced monthly.
The Aquanow DeFi Funding Index and Rate will be published on the Bloomberg Terminal under the tickers “ADFI” and “ADFR”, taking their place alongside other high-quality fixed income indices. Aquanow’s benchmarks are among only a few DeFi standards available today on the Bloomberg Terminal.