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Bakkt

Bitcoin Futures Platform Bakkt Begins Testing Today

It’s been a long road for Bitcoin futures platform Bakkt. The platform—developed by NYSE parent company Intercontinental Exchange (NYSE:ICE)—has faced a myriad of launch delays due to regulatory approval. It’s still waiting now, but in the meantime, it has begun testing its Bitcoin futures contracts today.

Here’s what we know.

Bakkt is Testing Bitcoin Futures Contracts

The company announced in May that it would begin testing its contracts in July. It later settled on the date of July 22, which is today. The company has not disclosed what is involved in the testing process but, according to sources, it is testing two different types of contracts today: a daily contract and a monthly contract.

Bakkt will list them, trade them, and clear them through ICE Futures US and ICE Clear US.

Until ICE receives regulatory approval for Bakkt, it cannot take the platform live. But there’s no harm in preparing for an official launch in advance.

Launch Delays

It has been almost one year since Bakkt was unveiled. The platform aims to offer potentially the first physically-settled Bitcoin futures in the US, but as stated, has had to delay its launch multiple times.

The initial launch date was set for December 2018. That date was then pushed back to January 2019. Subsequently, ICE announced an “indefinite delay” as it continued to work with regulators to secure approval.

>> How Will the Crypto Markets Perform in Coming Years?

Cash-Settled vs. Physical-Settled

Bakkt will offer US traders “access to physically-settled bitcoin futures contracts.” These differ from the “cash-settled futures contracts” that Chicago-based exchanges CME and Cboe have offered since 2017.

The difference is in what a trader will receive when the contract expires. With cash-settled contracts, traders receive the cash equivalent to the contract’s value when it expires. However, with a physically-settled contract, traders receive the underlying commodity, which in this case is Bitcoin.

Will Bakkt have to wait much longer do you think? Will the test run tell us a lot more about an official launch? What are your thoughts?

Featured Image: DepositPhotos © poznyakov

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Bakkt

Bitcoin Futures Platform Bakkt Begins Testing Today

It’s been a long road for Bitcoin futures platform Bakkt. The platform—developed by NYSE parent company Intercontinental Exchange (NYSE:ICE)—has faced a myriad of launch delays due to regulatory approval. It’s still waiting now, but in the meantime, it has begun testing its Bitcoin futures contracts today.

Here’s what we know.

Bakkt is Testing Bitcoin Futures Contracts

The company announced in May that it would begin testing its contracts in July. It later settled on the date of July 22, which is today. The company has not disclosed what is involved in the testing process but, according to sources, it is testing two different types of contracts today: a daily contract and a monthly contract.

Bakkt will list them, trade them, and clear them through ICE Futures US and ICE Clear US.

Until ICE receives regulatory approval for Bakkt, it cannot take the platform live. But there’s no harm in preparing for an official launch in advance.

Launch Delays

It has been almost one year since Bakkt was unveiled. The platform aims to offer potentially the first physically-settled Bitcoin futures in the US, but as stated, has had to delay its launch multiple times.

The initial launch date was set for December 2018. That date was then pushed back to January 2019. Subsequently, ICE announced an “indefinite delay” as it continued to work with regulators to secure approval.

>> How Will the Crypto Markets Perform in Coming Years?

Cash-Settled vs. Physical-Settled

Bakkt will offer US traders “access to physically-settled bitcoin futures contracts.” These differ from the “cash-settled futures contracts” that Chicago-based exchanges CME and Cboe have offered since 2017.

The difference is in what a trader will receive when the contract expires. With cash-settled contracts, traders receive the cash equivalent to the contract’s value when it expires. However, with a physically-settled contract, traders receive the underlying commodity, which in this case is Bitcoin.

Will Bakkt have to wait much longer do you think? Will the test run tell us a lot more about an official launch? What are your thoughts?

Featured Image: DepositPhotos © poznyakov

If You Liked This Article Click To Share

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Bakkt

Bakkt Announces Bitcoin Futures Launch Date in July

As Bitcoin (BTC) holds resistance above $8,100 USD, more positive news has arrived to help its case. Intercontinental Exchange’s (ICE) cryptocurrency platform, Bakkt, is to begin testing its first product: physically-delivered Bitcoin futures.

The date for launch is just over one month from now, July 22nd.

Bakkt Announces First Project Launch

In a blog posted earlier today, Bakkt chief operating officer Adam White wrote:

“On July 22, two days after Apollo 11’s 50th anniversary, Bakkt will initiate user acceptance testing for its bitcoin futures listed and traded at ICE Futures U.S. and cleared at ICE Clear US.”

He furthered:

“This is no small step. This launch will usher in a new standard for accessing crypto markets. Compared to other markets, institutional participation in crypto remains constrained due to limitations like market infrastructure and regulatory certainty.”

Bakkt’s Bitcoin futures offering has seen multiple delays due to regulatory compliance. It was first announced in August 2018, and investors have been eagerly awaiting its arrival since.

In addition to announcing the date, ICE provided new details regarding Bakkt’s monthly contract, as well as specifications for its daily contract.

The key details are as follows:

  • Each contract will contain one Bitcoin. And both monthly and daily contracts will see a minimum price fluctuation of $2.50 per Bitcoin.
  • Trades may be executed at $0.01 per Bitcoin and can list for as long as 12 months for monthly contracts or 70 consecutive days for daily contracts.

Final contract settlements for both contracts will occur at the Bakkt Warehouse.

Bakkt Versus Others

As stated, ICE first announced that it would be launching physically-settled Bitcoin futures contracts in August 2018.

>> Ethereum (ETH) Soars 8%, Outperforms the Broader Crypto Market

Bakkt’s futures differ from other futures out there. For example, CME Group offers cash-settled contracts as does CBOE. However, Bakkt customers receive an actual Bitcoin on the contract’s expiration and not the fiat equivalent to Bitcoin’s price.

Business in Bitcoin futures has been busy; CME Group showed record high volume in May.

However, the original Bitcoin futures provider, CBOE, will cease offering contracts once its final contracts settle this month.

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Bakkt

Bakkt Hires PayPal and Google Veteran as Chief Product Officer

Bitcoin futures exchange Bakkt has a new chief product officer. Announced via Medium earlier today, the exchange has added Mike Blandina to its team.

Bakkt Hires New CPO

In previous years, Blandina has worked at PayPal where he served as head of payments and credit engineering. He has also been director of engineering for Google Wallet.

In most recent years, Blandina was chief technology officer and product and engineering at OneMarket. CEO of Bakkt Kelly Loeffler wrote in the blog post:

“As our CPO, Mike will lead our efforts to converge a trusted ecosystem for digital assets with payments use cases, two elements of Bakkt that help bring real-world applications to bitcoin and other cryptocurrencies.”

Development

Bakkt is still awaiting regulatory approval in order to launch. It has faced multiple delays already with the initial launch expected back in November. However, in Loeffler’s posting, she said that “race day is approaching.” This comment has led some to wonder if the team has more clarity on its regulatory situation that it has yet to disclose.

She wrote further:

“As a former marathoner, this point in time recalls the stage in the training regimen when you’re putting in long runs with your training team […] there is more work to be done […] I’m proud to be going the distance with this growing team and of the culture we are building, while bringing digital assets into the mainstream economy.”

What is Bakkt?

Bakkt wants to offer a federally regulated market for Bitcoin, transforming Bitcoin into a trusted global currency with broad usage.

>> Coinbase Card: Now You Can Spend Your Crypto Instantly

Its main goal is to make Bitcoin a secure offering for the biggest global financial institutions that currently shun it. Bakkt is looking to create a path for these major money managers to offer Bitcoin pension funds, mutual funds, and ETFs as highly regulated, mainstream investments.

Approval

As stated, Bakkt is still waiting on approval from the US Commodity Futures Trading Commission (CFTC) to list its Bitcoin futures contract. One major consideration for the CFTC is that Bakkt’s proposal would see it warehousing its own Bitcoin. This may be one cause for delay.

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Bakkt Looks for Support for Its Next Futures Contract

As Bitcoin continues to slide past the $4,500 mark, bullish investors need something to hold onto. Bakkt is trying to give it to them.

Intercontinental Exchange, the owner of the NYSE, is fighting the good fight with a plan to make cryptocurrencies mainstream.

Bakkt is its plan.

The new platform offers regulated trading, clearing and custody, and security. It is a safe environment for consumers to buy, sell, store, and spend digital assets.

Bakkt and Bitcoin

The platform’s first futures contract will be a Bitcoin one, as it is “the clear crypto leader.”

What will be the next futures contract?

In order to expand its offering, Bakkt is looking to the community to help decide what digital asset to support:

“As the world’s most liquid and widely distributed cryptocurrency, and where we’ve seen the most customer demand, bitcoin’s profile creates a liquid product on which to build a futures contract. We’ll consider additional contracts as the landscape evolves and as we receive additional customer feedback about what they want and need.”

>> Bitcoin Cash Hard Fork Controversy: Roger Ver vs. Craig Wright

Bitcoin Futures Contract

Bakkt has had to delay the first Bitcoin futures contract. Pending regulatory approval, it is now scheduled to launch on January 24th, 2019.

It made the announcement yesterday saying the following:

“As is often true with product launches, there are new processes, risks and mitigants to test and re-test, and in the case of crypto, a new asset class to which these resources are being applied. So, it makes sense to adjust our timeline as we work with the industry toward launch.”

The company has also blamed the “volume of interest” in the contracts and how that has meant more time needed to ensure everything is fully ready for launch.

Until Bakkt’s Bitcoin futures launch, it will be hard to think of any other coin launch yet. Success is riding on the first!

Featured Image: Depositphotos/© Fotofabrika

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