Despite being officially announced in August 2018, the platform only received a trust charter from New York State Department of Financial Services this week, which clears the way for the company to begin offering its highly-anticipated physically-settled Bitcoin futures contracts. Bakkt expects to serve a digital marketplace that moves $270 billion per year.
What is Bakkt?
The Intercontinental Exchange, the parent company of the New York Stock Exchange, announced Bakkt a year ago with the intention of creating “an open and regulated, global ecosystem for digital assets.” This means that the platform aims to provide a variety of services relating to cryptocurrency, such as trading, warehousing, and physically delivered Bitcoin contracts. Essentially, Bakkt aims to be the first platform to enable the conversion of cryptocurrency to US dollars for transnational use.
When the platform was first unveiled 12 months ago, ICE eyed a December 2018 launch date as it intended to have the US Commodity Futures Trading Commission (CFTC) approve its proposed contracts. However, Bakkt was subsequently faced with a series of regulatory hold-ups that forced the launch date to be pushed back to 2019. In May of this year, the company announced it had self-certified its futures contracts through the CFTC, instead of having the commission approve the platform.
User acceptance testing began in July this year, which ensured that users of the platform could communicate with its infrastructure, and this allowed Bakkt to begin the work of taking on potential customers.
What does Bakkt Mean for Cryptocurrencies?
Bakkt has massive potential for the future of cryptocurrencies, and this was apparent as Bitcoin’s value surged nearly $600 USD on Friday to once again break the $10,000 USD mark. Due to the nature of Bakkt’s services, it is expected to increase the liquidity of Bitcoin and other cryptocurrencies as it will make it much easier for traders to do business in crypto.
Added to this, Bakkt is tied to the traditional financial industry as a result of its close links with the NYSE. Crypto speculators will be hoping that this link generates a confident sentiment among investors.
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