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The SR20 is an objective staking market index. Comprised of the largest income-generating crypto-assets, the SR20 generates additional passive income by leveraging modern Proof-of-Stake Technology.
The SR20 Index
The SR20 Index is made up of the Top 20 Proof of Stake Cryptoassets weighted by their Total Staked Value (capped at the Circulating Market Cap). The Index accrues staking rewards on a continuous basis.
Rebalancing of the Index
For each PoS asset, we take the Total Staked Value capped at the Circulating Market Supply and pick the Top 20, sorted from highest to lowest on this new Metric we call the ‘Asset Weight’. The Cap was introduced such that assets where locked (unvested) tokens can be staked, does not overly skew the weighting of this Index. Once we have picked the Top 20 assets, we sum up their relative Asset Weights to get the Total Index Weight and give each Asset a percentage of how much of the Total Index Weight their Asset Weight contributes to. Following this, we take the latest value of the Index, and spread it across the assets based on their Asset Weight Percentage. This rebalancing event takes place every 1st of the Month.
The Index has a creation date of the 1st of January 2021, at a starting value of $100. This $100 was divided across the Top 20 assets following the above method.
As the index is composed of only Proof of Stake assets, and such assets can be staked to gain a reward, we have included this reward in the calculation of the Index. As this is a purely data driven, unbiased representation of the PoS market, we have taken the average reward rate across all validators as to not play favorite. It is important to note, that if you were to follow this Index exactly since inception, your return could be higher or lower, based on the fees you paid to trade in and out of positions as well as how you decided to stake your assets.