March 22, 2024

Access Bitcoin and Crypto Reference Rates

Amberdata’s crypto reference rates provide a fair, reliable, and consistent measure of price for digital assets such as BTC, ETH, and stablecoins. These reference rates are crucial in helping market participants make informed trading decisions, price assets, settle contracts, and in reporting/accounting for research and compliance purposes.

Reference rates differ from reference quotes as the former provides benchmark prices for assets, while the latter provides actionable median price quotes for pairs across supported exchanges.

Calculating Hourly & Daily Crypto Reference Rates

Our crypto reference rates utilize a multitude of input data to produce weighted and median values that accurately represent the asset’s economic activity.

Our complete methodology for deriving hourly & daily crypto reference rates can be found in our comprehensive Reference Rate Whitepaper.

As an overview, we take a set of qualified transactions within a specified lookback window across exchanges and convert them to U.S. dollar prices if necessary. We then perform several calculations to derive various weighted and median price values. The derived price values are used in further calculations to generate a time-weighted average representing the hourly reference rate. When appropriate, we mark the hourly reference rate as a daily reference rate in supported timezones and geographies.

To ensure stability, our reference rate calculations are designed to minimize the impact of anomalies such as regular price fluctuation and contingencies like missing, delayed, or unavailable data. Additionally, our use of weights and medians in our algorithm ensures it is manipulation-resistant.

Use Cases for Reference Rates

Digital asset reference rates play a key role in the market as participants can utilize them in front, mid, and back office functions such as research, trading, hedging, and accounting.

Benchmarking for Trading and Derivatives. For traders, utilizing reference rates as a benchmark allows for planning investment strategies, anchoring trading activities, and executing trades.

Creating Indices. With reference rates, you can create indices to measure the price performance of volatile assets or gain a comprehensive overview of the market’s performance. Indices also help institutions execute arbitrage trading by benchmarking their portfolios against market performance.

Price Assets and ETFs. Traders can use crypto reference rates to price assets and funds, or determine a BTC ETF’s net asset value (NAV) over short and long periods while ensuring fairness and transparency in pricing.

Settle Contracts. Bitcoin reference rates can serve as a convenient benchmark for determining prices of contracts that require frequent settlements or adjustments while ensuring that futures and options contracts settle at fair prices.

Hedging Risk. In terms of risk management, reference rates can help in making strategic investment decisions like hedging against price fluctuations or implementing other risk mitigation tactics like placing stop-loss orders to protect your portfolio.

Accounting and Reporting. Reference rates can be used for digital asset valuations in accounting and financial reporting for research, analytics, and regulatory compliance purposes.

Maintaining Compliance. Because digital assets lack a clear principal market due to assets transacting on multiple exchanges at different prices, it becomes difficult to derive a fair value price for an asset, as required by ASC 820 (FASB). However, Amberdata’s reference rates solve this problem by including transactions from multiple exchanges and then aggregating and weighing them to produce a fair value price—the reference rate.

Accessing BTC Reference Rates

Amberdata’s BTC, ETH, and stablecoin reference rates offer unparalleled precision due to our unique bias-resistant weighting mechanisms and emphasis on utilizing recent data in calculations to achieve better accuracy. As an additional measure, we use the previous hour as a fall-back reference to preserve relevancy, unlike other solutions with a 24-hour lag on rates.

Supported Exchanges

Exchanges are only eligible to be included in our list of supported venues if they meet our stringent methodology. Currently, our list of supported exchanges includes: