Subsidiary of Kraken Becoming Under-the-Radar Beneficiary of Multi-Billion ETF Boom: Report
A subsidiary of US-based crypto exchange Kraken is reportedly greatly benefiting from the success of the spot Bitcoin (BTC) exchange-traded fund (ETF) boom.
According to a new report by Bloomberg, CF Benchmarks – a London-based subsidiary of Kraken that provides reference data for about $24 billion in crypto ETFs – is emerging as an under-the-radar beneficiary to the launch of the BTC ETFs.
A benchmark is a standard used for comparative purposes when assessing the performance of assets or a portfolio.
According to Bloomberg, CF Benchmarks licenses its benchmarks to Bitcoin ETF issuers including BlackRock in exchange for fees that increase as an issuer’s assets under management rise.
Spot market BTC ETFs were approved by the U.S. Securities and Exchange Commission (SEC) in January and also debuted in Hong Kong within the last two weeks.
CF Benchmarks chief executive Sui Chung tells Bloomberg in an interview that he envisions BTC ETFs hitting Israel and South Korea after being approved by regulators in Hong Kong.
“South Korea is a market where ETFs have become the wrapper of choice for long-term savings. It is also a market where digital assets have gained a high degree of adoption.”
According to Bloomberg, CF Benchmarks expected $5 billion of assets from spot market BTC ETFs that utilize its indices but ended up with a figure four times larger than that.
Chung also tells Bloomberg he expects another $1 billion in assets to come under management for Hong Kong BTC ETFs by the end of the year.
Chung says that CF Benchmarks – which was acquired by Kraken in 2019 for a nine-figure sum – sees its revenue growing to the “mid-double digits” this year.
Bitcoin is trading for $63,433 at time of writing, a marginal increase on the day.
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