Bakkt, the new cryptocurrency trading platform launched by the Intercontinental Exchange (ICE), is finally opening up for business. After nearly a year of delays and false starts, Bakkt has now received approval from the Commodity Futures Trading Commission (CFTC), and the New York State Department of Financial Services, to launch in late September.
And the news is music to the ears of those waiting for that sweet, sweet institutional money to coming cha-chinging through Bitcoin’s door.
“The Bakkt news is arguably the most bullish event for institutional investors in the history of bitcoin,” said cryptocurrency analyst and trader Scott Melker in a post on Twitter. Melker explained that the notion of physically delivered bitcoin futures will require holders to either produce actual bitcoins or take delivery from their respective exchanges.
This, combined with the support of the New York Stock Exchange, suggests that the bitcoin market is quickly maturing. And it’s that approval from the pillars of the financial world that’s the key.
Bakkt aims to provide institutional traders with both daily and monthly physical bitcoin futures contracts, which could potentially lead to mainstream acceptance of both Bitcoin and its crypto cousins. Much like the Gemini-backed Flexa, Bakkt is also looking to recruit several commercial retailers, such as Starbucks, to engage in its plans. The idea is to provide consumers with an easy way to purchase both goods and services with digital currencies—a monumental step for the industry.
In terms of what Bakkt represents for both cryptocurrencies such as Bitcoin and its investors, Linda Lacewell, superintendent of the NYDFS, perhaps put it best: Bakkt, she wrote, is “furthering innovation while protecting consumers.”
Jake Chervinsky, a former securities litigator and general counsel for Compound Finance, echoed the sentiment. The reason Bakkt is important, he said, is because “it offers a way for large, risk-averse institutions to buy and custody bitcoin through an end-to-end regulated system approved by the CFTC and NYDFS, and backed by the sterling reputation of ICE.”
But as Chervinsky noted, it’s still too soon for Bitcoin hodlers to celebrate the news. After all, receiving approval from the CFTC and NYDFS is but the first step on a very long regulatory road, and Bakkt likely still has the SEC to contend with.
And despite the many fist-pumping cheers throughout the cryptoverse, there’s still one very big lingering question among skeptical observers: After so many starts, stops, and Bitcoin-dream-shattering delays, is Bakkt launching for real this time?