US regulators could approve Bakkt Bitcoin futures trading as early as the first week of November, according to unconfirmed reports.
What is Bakkt, and What Will It Do?
Bakkt is a new trading platform launched by the Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange (NYSE).
First announced in August of this year, the platform is a joint effort between the ICE, software king Microsoft, and coffee giant Starbucks. Bakkt is designed to give merchants an opportunity to accept cryptocurrencies as payments for goods and services while making it easier for retail investors to purchase, sell, and trade digital assets.
One of Bakkt’s primary staples is that it will offer physically delivered Bitcoin futures, a system designed specifically to entice institutional investors to enter the cryptocurrency space. Wall Street players and other financial magnates have been relatively slow to enter the digital asset arena given the volatility often witnessed amongst payment coins such as Bitcoin and Ether.
Setting the Path
The thought of losing one’s money as soon as it’s invested is a frightening one, though many believe further participation from institutional figures would likely bring an air of legitimacy to the digital currency market not yet witnessed.
Non-physical Bitcoin futures have been around since December 2017 via platforms like CBOE and CME Group. While things got off to a rocky start, futures trading is now up by roughly 41% from Q1 2018 to Q3 2018, despite Bitcoin’s consistent price swings throughout the year. CME Group reports over 5,000 settled contracts in Q3, while open-interest contracts exceed 2,500.
A Small Delay in the System
The statement read:
ICE Futures U.S., Inc. will list the new Bakkt Bitcoin (USD) Daily Futures Contract for trading on Wednesday, December 12, 2018. The Bakkt Bitcoin (USD) Daily Futures Contract is a physically-settled daily futures contract for bitcoin held in Bakkt LLC, ICE’s Digital Asset Warehouse, and will be cleared by ICE Clear US, Inc.
It’s All Happening Soon, People!
The above mentioned press release goes on to explain:
Each futures contract calls for delivery of one bitcoin held in the Bakkt Digital Asset Warehouse, and will trade in U.S. dollar terms. One daily contract will be listed for trading each Exchange Business Day.
However, an anonymous source has now come forth to suggest that US regulators could approve Bakkt’s physically delivered Bitcoin futures as early as the first week of next month. The unnamed source has also stated that Chicago trading shop DV Trading is set to trade Bakkt’s product.
Unfortunately, not everyone in the crypto space is breaking out the champagne. Some industry experts – including crypto enthusiast Andreas Antonopoulos – have shown concern regarding non-custodial options, saying that these items are likely to detract from the industry’s credibility and potentially get in the way of a Bitcoin exchange-traded fund (ETF) later down the line.
Several analysts believe the VanEck SolidX Bitcoin ETF – now under the consideration of the Securities and Exchange Commission (SEC) – has the highest chance of garnering approval and setting the precedent for future Bitcoin trading.