The owner of the New York Stock Exchange (NYSE), Intercontinental Exchange, has launched a bitcoin futures exchange.
The long-gestating Bakkt is a futures exchange for Bitcoin, meaning traders can bet on whether the cryptocurrency’s price will rise or fall. First planned to open in 2018, regulatory hurdles and other issues repeatedly postponed the launch before it went live this Sunday.
Beyond the legitimacy-generating backing of Intercontinental Exchange, Bakkt is also partnering with the likes of Starbucks, Microsoft and Boston Consulting Group to deliver the platform.
The end goal for Bakkt entails making Bitcoin an accepted part of the financial ecosystem, and bringing the currency inside a federally regulated framework is just the first part of that process. In a blog post before the launch, Bakkt’s COO Adam White said: “we will create the first fully regulated marketplace specifically designed to meet the needs of institutional firms and their clients. This is evidenced by the quality of firms we are working with across trading, clearing, and investing, which are helping frame this new asset class and the infrastructure required to gain wider acceptance and applications.”
Prior to the opening the company launched the Bakkt Warehouse for the deposit and withdrawal of Bitcoin in a safe and secure environment, with the company saying the service was powered by the same infrastructure and security as the NYSE. The Warehouse will act as custodian for physically delivered futures.
Kelly Loeffler, the company’s CEO, outlined Bakkt’s vision, saying: “by now, digital asset markets are global and well-developed, but they have largely been designed to serve retail customers rather than institutional participants. Bakkt is bridging that gap to access this market and solve for factors that have slowed institutional participation. Whether concerns relate to a lack of liquidity, market quality and regulation, or issues with reliability, fees, and operational risks, we are addressing these challenges with a transparent offering.”