Bakkt’s Bitcoin futures
Bakkt, a subsidiary of the Intercontinental Exchange (ICE), was recently granted approval from the U.S. Commodity Futures Trading Commission (CFTC) for crypto-settled Bitcoin futures. These contracts are meant to allow institutions to gain exposure to Bitcoin while acting as a tool for more sophisticated trading strategies.
Unlike existing Bitcoin futures contracts from the Chicago Mercantile Exchange (CME), which are only settled in cash, this will be the first physical Bitcoin-settled futures on the market.
Several analysts, such as @Rythmtrader, believe that this could be the catalyst that takes cryptocurrencies into the mainstream, bringing institutional capital and liquidity into the space.
Remember, the hype is bakkt with substance.
Unlike other futures exchanges, this is settled in bitcoin. Actual bitcoin is paid out, not just the fiat equivalent to the price of bitcoin.
The result is better price discovery and liquidity for bitcoin and everyone in the space.
— Rhythm (@Rhythmtrader) August 28, 2019
ICE CEO Jeff Sprecher also expects Bakkt to become a major part of the firm’s revenue.
“That infrastructure has attracted a lot of very, very interesting companies that have come—some that have invested in Bakkt, some are just working with Bakkt to try to tap into that infrastructure for some new use cases that will involve blockchain and digital assets and other things that we can provide these people… So it’s a bit of a moonshot bet and it’s been organized in a manner that is very different than the way ICE typically does business,” said Sprecher.