The 12 Months of Crypto: August
What does the creation of Bakkt mean for you?
This is part of a 12 part highlight reel by BlockWorks Group where we review the biggest crypto and blockchain story from each month of 2018.
The Story
On August 3rd, the Intercontinental Exchange (ICE) announced its plans to form a new company, Bakkt.
With a goal of “creating an open and regulated, global ecosystem for digital assets,” Bakkt announced it would be working with a marquee group of organizations including BCG, Microsoft, Starbucks, and others, to create an integrated platform that enables consumers and institutions to buy, sell, store and spend digital assets on a seamless global network.
“In bringing regulated, connected infrastructure together with institutional and consumer applications for digital assets, we aim to build confidence in the asset class on a global scale, consistent with our track record of bringing transparency and trust to previously unregulated markets,” said Jeffrey C. Sprecher, Founder, Chairman and CEO of Intercontinental Exchange.
Upside
- This will potentially generate giant trading volume by institutions, which will smooth out the volatility that Bitcoin is famous for.
- Less panic selling now that derivates are available. This means that investors will have the ability to hedge their long bets on Bitcoin.
- More merchants will accept Bitcoin through the infrastructure that ICE creates.
- Increases Bitcoin’s credibility and reputation and drives adoption.
Concerns
- If Bitcoin forks, what happens to the Bitcoin held on the Bakkt exchange?
- Inflating Bitcoin’s supply. This now means that Wall Street will be able to create claims to Bitcoin out of thin air.
- Goes against “Not your keys, not your Bitcoin” because it’s all held in the Bakkt infrastructure.
Caitlin Long is Not a Fan
Caitlin Long spent 22 years on Wall Street, including stints at Morgan Stanley, Credit Suisse, and Solomon Brothers.
At Morgan Stanley, she was Head of Corporate Strategies and Pension Solutions.
She’s been a Bitcoin proponent since 2012, and most recently led the charge for friendly crypto regulations in the state of Wyoming.
In September, Anthony Pompliano and Caitlin sat down to discuss why Wall Street’s involvement may hurt Bitcoin (rather than helping it as many think), including why the Bitcoin ETF could actually be a bad idea and how Wall Street could actually kill Bitcoin.
Bakkt Bitcoin Futures Contract Begins Trading on January 24, 2019
On November 20th, ICE announced it would be listing the new Bakkt Bitcoin (USD) Daily Futures Contract for trading on trade date Thursday, January 24, 2019.
The Bakkt Bitcoin (USD) Daily Futures Contract is a physically-settled daily futures contract for bitcoin held in Bakkt Warehouse.
“Bakkt is designed to serve as a scalable on-ramp for institutional, merchant and consumer participation in digital assets by promoting greater efficiency, security and utility,” said Kelly Loeffler, CEO of Bakkt.
Bakkt’s Partners
In addition to Intercontinental Exchange and M12, Microsoft’s venture capital arm, investors in Bakkt are expected to include, among others, an affiliate of Fortress Investment Group, Eagle Seven, Galaxy Digital, Horizons Ventures, Alan Howard, Pantera Capital, Protocol Ventures, and Susquehanna International Group, LLP.
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