On October 7, S&P Global launched a new tool for crypto investors called the S&P Digital Markets 50 Index. This index is designed to track the performance of 50 different cryptocurrencies and crypto-related stocks. It works like a snapshot of the overall crypto market, helping people see how the crypto world is doing at any given time.

S&P Dow Jones Indices, the same group behind the famous S&P 500 stock index, created this new index. Just like how investors check the S&P 500 to understand how the stock market is performing, this new crypto index could become the go-to for tracking digital assets.

This move could be a big deal for crypto. One major hurdle for cryptocurrency going mainstream has been accessibility. Many people still find it difficult or confusing to invest in digital assets. This new index could simplify things by offering an easy way to follow and invest in a wide range of crypto assets through future ETFs or mutual funds.

What makes this index special is that it includes both cryptocurrencies and crypto-related stocks — most previous indexes only focused on one or the other. That makes the S&P Digital Markets 50 Index a hybrid approach and more reflective of the entire digital asset ecosystem.

Other companies have tried similar ideas before. For instance, Coinbase launched its own Coinbase 50 Index in November 2024. However, most of these indexes focus strictly on either coins or companies, not both.

With this new index, investors could soon buy into crypto just like they do with traditional stocks — with one click through an ETF or fund. That would make it easier to diversify a portfolio without needing multiple accounts or platforms.

In the long run, this index could attract big-name investment firms that have been hesitant about crypto. Take Vanguard as an example — the $10 trillion asset manager known for its index funds. Vanguard has mostly stayed away from crypto, but recently showed signs it might start offering access to crypto ETFs. If major firms like Vanguard jump in, that could be a turning point for crypto adoption.

However, there are still some concerns. Index investing works well with stocks because there are hundreds of solid companies to choose from. But in crypto, the list of high-quality coins is much shorter. The S&P Digital Markets 50 Index includes only 15 cryptocurrencies, and even that might be too many. Outside of top names like Bitcoin and Ethereum, quality starts to drop off fast.

Do you really want meme coins or highly speculative tokens in your portfolio? Some tokens in existing indexes like Coinbase’s look questionable for long-term investors or institutions.

There’s also the risk of spreading your investments too thin. Owning too many coins and stocks can water down your returns without adding real diversification. Many crypto stocks are closely tied to Bitcoin’s price — think mining companies or firms holding Bitcoin on their balance sheets — so owning a lot of them might not reduce risk as much as expected.

Still, launching the S&P Digital Markets 50 Index is a step in the right direction. It gives investors a clear view of how the crypto market is performing and opens the door for new investment products that are easier to access and understand.

While it’s too early to say if any new crypto ETFs or funds based on this index will be worth investing in, it’s clear that tools like these are helping bring digital assets closer to mainstream finance.