Kraken's subsidiary, CF Benchmarks, has seen a significant surge in demand for its indices due to the rapid growth of spot Bitcoin exchange-traded funds (ETFs) in the United States and Hong Kong. This growth has led to a substantial increase in the company's market share, with CF Benchmarks now representing almost half of the crypto benchmarking market. The company's indices are used by about $24 billion in crypto ETFs, primarily BlackRock's iShares Bitcoin ETF, which has assets under management (AUM) of $16.2 billion.

CF Benchmarks expects its revenue to almost double this year due to the rising demand for spot Bitcoin ETFs. The company's revenue has already reached £6 million ($7.5 million) in 2022, and it plans to expand its headcount by around a third to more than 40. Kraken acquired CF Benchmarks in 2019.

The company's CEO, Sui Chung, believes that CF Benchmarks will work with crypto ETF issuers in South Korea and Israel next. South Korea is known for having one of the largest crypto user bases, with high trading volumes significantly impacting crypto prices. The country has also seen a significant adoption of digital assets, making it an attractive market for ETFs. In fact, ETFs have become the preferred wrapper for long-term savings in South Korea.

CF Benchmarks expects Hong Kong-based spot Bitcoin and Ether ETFs to reach $1 billion in funds under management by the end of the year. Interestingly, while other markets have seen outflows from digital asset products, Hong Kong has seen inflows of $300 million so far this week. This trend suggests that Hong Kong is a key market for crypto ETFs, and CF Benchmarks is well-positioned to capitalize on this growth.