Bakkt: testing of bitcoin futures has begun
Bitcoin

Bakkt: testing of bitcoin futures has begun

By Marco Cavicchioli - 23 Jul 2019

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Bakkt has announced that it has begun user acceptance testing of Bakkt Bitcoin Daily & Monthly Futures contracts. 

According to the company, the tests proceed as planned with participants from all over the world. 

Bakkt is a subsidiary of the Intercontinental Exchange (ICE), the company that owns the New York Stock Exchange, hence its entry into the crypto world could have a significant impact. 

For the time being, these are only tests, but according to Fundstrat’s Quant Strategist, Sam Doctor, they could be launched on the market by the end of this quarter, that is, by the end of September 2019. 

The news of the start of the tests has not led to an increase in the price of bitcoin, which has been falling since yesterday. However, there is no guarantee that the decline is linked to this news. 

According to many experts, the market launch of these physical bitcoin-based futures contracts, regulated in BTC, and other similar financial products, could facilitate the adoption of this asset by large institutional investors.

Bakkt’s futures are fully regulated, i.e. legally suitable for institutional investors as well, and buying them actually means buying real bitcoins, but the BTC are kept by Bakkt in their wallets. 

For example, CoinShares’ Meltem Demirors in congratulating Bakkt on the launch of the tests, argues that the bitcoin market is changing rapidly, and futures, derivatives and synthetics will radically change the nature of this market.

In this regard, a graph shows the relationship between the trading volumes of gold and gold derivatives from 1997 to the present day, which clearly shows how the volume of derivatives has literally risen over the years, going far beyond that of physical gold. 

On the other hand, there are also data from hedge funds investing in cryptocurrencies that show that institutional demand for bitcoin is growing rapidly. There are also some data from exchanges that would suggest that this demand is on the rise. 

However, it should be noted that in order to be launched on the market, these bitcoin futures contracts require the approval of the CFTC, which has not yet arrived. 

Marco Cavicchioli
Marco Cavicchioli

Class 1975, Marco teaches web-technologies and is an online writer specializing in cryptocurrencies. He founded ilBitcoin.news, and his YouTube channel has more than 11 thousand subscribers.

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