In a tweet made yesterday, ICE’s Bakkt, which operates the NYSE (New York Stock Exchange), revealed that its first cryptocurrency contract will be physical bitcoin futures, finally allowing institutional investors who have been waiting to put their money on physical bitcoin futures.
Our first contracts will be physically delivered Bitcoin futures contracts versus fiat currencies, including USD, GBP, and EUR. For example, buying one USD/BTC futures contract will result in daily delivery of one Bitcoin into the customer’s account.
— Bakkt (@Bakkt) September 25, 2018
Announcement built on a previous confirmation
The announcement by Bakkt is built on a previous confirmation on August 2018, when ICE revealed that Bakkt would launch a federally regulated, physical bitcoin futures contract and warehouse on November 2018.
Although ICE did not give further details as to when the launch would take place, it confirmed that its use case will be conversion and trading of bitcoin versus fiat currency, addressing the evolving need for adoption in the digital asset marketplace.
What does the announcement mean for the bitcoin and cryptocurrency market?
Having a physical bitcoin futures contract is certainly great news for large institutional investors. As such, crypto experts believe that the opening of the Bakkt exchange will be a very bullish sign for the bitcoin price and the cryptocurrency market in general. This is largely because the futures contract will have to go through approval by the Commodity Futures Trading Commission (CFTC).
SEC’s decision on ETFs
The announcement by Bakkt will go a long way in bringing big money investors one step closer to adopting cryptocurrencies, as everyone eagerly waits for SEC’s decision on the appeal of bitcoin ETF approvals.
Following the announcement by Bakkt, bitcoin’s price has recorded a 1.19% growth to trade at £4921 ($6,478), as of 9:45 London time. It’s expected that the price of bitcoin will make significant gains once the official launch of the physically-backed bitcoin futures contract is launched.
Bakkt is a firm formed through collaboration between ICE, Microsoft, BCG and several other companies. Its goal is to develop an open, global network for merchants, investors and consumers to buy, sell, spend, and store digital assets in a simple, secure, and efficient manner. Unlike most other crypto exchanges, Bakkt offers large institutional investors custodial services.