The Intercontinental Exchange backed bitcoin warehouse and futures contract facilitator, Bakkt is finally launching on Monday after two postponements and 13 long months of questions. It is inviting institutional investors to claim their position on the cryptocurrency in a federally regulated platform.
Trading is scheduled to open at midnight UTC and be closed down at 22:00. Curious observers will finally be able to witness the full demand for a service like this among big-money traders. The crypto venue’s data feed will be available for free until June of next year, after which the company FAQ lists that a subscription will be required to access the same.
Bakkt’s futures will be physically settled. Buyers will receive BTC at expiration, and the futures available from 2017 at the Chicago Exchange CME Group will be paid with cash, especially the side-bets on the crypto’s price.
ICE’s BTC futures contracts will expire in a day. This means that the BTC will be delivered the second day after the agreement, as explained in the daily contract’s specifications.
In the case of the majority of commodities, the underlying asset is not delivered for a minimum of 30 days. Bakkt is offering users this 30-day option too. The one day contract, however, attempts to convenience institutions who are not familiar with the roundabout manner in which crypto exchanges work.
CEO of LevelTradingField, a crypto derivatives exchange operator trusts that the one-day contract will have a massive influence on the cash market. While the cash market should ideally dictate the price of futures, that isn’t always the case. So, overall, it would be interesting to observe how the one-day futures contract and the cash market interact with each other.
However, ICE’s new futures contracts should not have too much say over the crypto market, in general. It’s because the company isn’t looking to do business with retail customers, who continue to make up the bulk of crypto traders.
Gustavo Fonseca loves anything digital and crypto-related which makes him sit up and pay attention. He got into the world of digital marketing and business digital transformation career in 2010. Some time later he got into Crypto, a dynamically developing segment at the intersection of the financial services and technology. Gustavo joined TheDailyCoins in September 2018.