• BCMstrategy, Inc.

#Cryptocurrency & #AlternativeData -- a perfect match

Portfolio Managers and institutional investors strive to acquire informational advantages and to make data-driven decisions. New markets challenge their ability to apply traditional historical data to address new contexts, which is why we launched the free LinkedIn Newsletter (AltData and Volatility Frontiers). Important issues arise regarding data curation and model parameterization when using new datasets. The challenges are amplified for new markets for which historical data and is nonexistent or of limited utility.

This is especially true in the DeFi and cryptocurrency investment space. Portfolio managers and other Institutional investors are preparing to enter cryptocurrency markets at scale during 2022, joining major banks like JPMorganChase that pioneered the stablecoins space years ago. But they are uniquely exposed to public policy risks because the rulemaking processes regarding these new markets is only just heating up.

As is typical in frontier markets, different policymakers around the world are taking different paths. While all consistently seek to extend the regulatory policy perimeter and generate competition for private coin issuers, they are taking different routes. US policymakers seem to be focused on stablecoins and the formal banking sector. The ECB instead is intensifying its efforts to launch a digital euro. Policymakers in Singapore, Australia, and Japan also continue their slow and steady march into the modern era for payments and currency.

Markets will not wait for the policy process to conclude. Fortunately, institutional investors and professional portfolio managers now have access to PolicyScope data to help them measure and manage their exposures to these public policy risks. Recent backtests show this data provides advance notice of market volatility. Consider:

DeFi and cryptocurrency investors can access this data in the manner that suits their workflows best:

  • The Data Firehose: Large funds seeking the big picture can access the full PolicyScope database, including 3 years of historical data for 1000+ lexicon terms (for all policy sectors, not just digital currency) mapped to 300+ economic sectors via the Bloomberg Enterprise Access Point.

  • Bloomberg Terminal Users/Human Readers: Our V3 app for the Bloomberg Terminal ({APPS PLCY <GO>}) delivers to human strategists and analysts access not only to charts and graphs regarding Digital Currency policy volatility; it also delivers to them the ability to read the underlying documents and immediately connect with market data through interoperability with key Bloomberg Terminal Functions (PORT, TREN, WEIF, BI, IB).


About BCMstrategy, Inc.: BCMstrategy, Inc. uses award-winning technology to measure public policy risks objectively using 9+ layers of patented analytical automation. We convert the words of the public policy process into numbers objectively, automatically, and daily so that investors can make better decisions about their exposure to public policy risks using hard data. The underlying data (including 3 years of historical multivariate time series data) is available to quantitative analysts exclusively through the Bloomberg Enterprise Access Point. Specialized signals (single factor quantitative + verbal data) are available via API for the following issue areas: cryptocurrency policy (DCVS 1) , central bank digital currency policy (DCVS 2) , and climate-related disclosure policy.