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How do benchmarks contribute to the creation of index funds and ETFs in the cryptocurrency market?

Benchmarks play a crucial role in the creation of index funds and exchange-traded funds (ETFs) that are designed to track the performance of a specific cryptocurrency or a basket of cryptocurrencies https://paybis.com/ltc-to-usd/ . These funds replicate the composition and weightings of the benchmark index, allowing investors to gain exposure to a diversified portfolio of crypto assets without directly holding individual coins. By following the benchmark's performance, fund managers can adjust the fund's holdings to mirror market trends and optimize returns for investors seeking exposure to the broader crypto market.