Brave New Coin partners with Smartbit to Create first Blockchain-Backed Market Index. In a first-of-its-kind, new partnership records market-data on the Blockchain. By securing any market feed onto the bitcoin blockchain, Brave New Coin and Smartbit hope to revolutionize markets in several important ways.
Today Brave New Coin (BNC) and Smartbit officially announce their partnership and the securing of the world’s first Price-Index on the Blockchain.
The ability to offer ‘provable market data’ has previously been impossible or extremely difficult.
The partnership will be the first to engage in ‘Market-Chaining,’ the process where financial data such as market indexes, quotes and trades will be secured onto the Blockchain, providing immutable receipts.
The ability to offer ‘provable market data,’ or immutable and trustless market records is now a reality and it creates exciting new opportunities to reshape the legacy global financial framework.
“Blockchain technology represents a fundamental shift in how we look at value and trust. By securing Market-Data on the Blockchain, we delete trust from many equations.”
– Fran Strajnar, Brave New Coin CEO
Bitcoin, the digital currency, is the first ‘App’ that came with the invention of the Blockchain. The first data stream to be offered in this format will be BNC’s Bitcoin Liquid Index, the BNC-BLX, a comprehensive historic & live bitcoin index, purpose built for settlement of bitcoin derivatives. As financial services operators use blockchain technology for exciting new solutions like ‘proof of reserves’, the market appetite is also growing to see blockchain technology rolled out for ‘proof of settlement’, which is one of the verification and auditing implications of Market-Chaining.
“Tying application specific data to immutable transactions will have some profound implications to groups and individuals we didn’t know was possible before. Using existing data storage technologies, we can tie any number of data points in a provable and predictable fashion to the blockchain. Doing this gives new and existing applications the security and immutability of the blockchain, without having to create new tokens or competing chains.”
– Jarred Spriggs, Smartbit co-founder
Market-Chaining has several benefits. If an asset is registered by an index provider on the blockchain, depending on the configuration, either anybody or permissioned parties can verify that third parties brokering, selling or facilitating financial products settling against an index are acting legitimately. This has vast implications for auditing trade and settlement, such as offering a verification layer between them by tying together index feeds for broker quote, trade and settlement systems.
“The biggest benefit of embedding the BLX or any Index, along with the biggest benefits of Bitcoin is transparency, immutability
and security. Finance data and prices affect everything we do, from buying groceries to paying for fuel. These prices are driven by commodity indexes and it’s extremely important that we have provable historic data to ensure even simple things like paying for fuel is fair.” -Spriggs
BNC’s BLX consists of nearly 2 million data points, which build a historic picture of bitcoin’s market activity since trading began of trading on MtGox in 2010. BLX’s transition onto the blockchain, it’s genesis, can be viewed on Smart-Bit’s Block-Explorer here.
Above on the right: Securing an price index on the blockchain
Merkle Root embedded in this transaction: 4df31110dd5a5d7f06eeef3ba1bba5afcb9e604b5f35ffef39d580c70a629d5b
One of the outputs from the BNC-BLX is an indexed price feed (tick) every 30 seconds. Each one of these nearly 2 million historic data points was hashed individually on the Blockchain using a Merkle Tree. This was done to create a proof of each data point without spamming the blockchain with 1 transaction per record.
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