The news of Bakkt’s September 23 launch has broken the crypto internet. The market is all green with Bitcoin alone has gained over $600 in the last 48 hours. Crypto Twitterati has welcomed the news with a shower of excited tweets.
To give you perspective, Bakkt is a bitcoin futures exchange and digital assets platform founded by Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange (NYSE). Several major organizations including Boston Consulting Group (BCG), Microsoft and Starbucks are working to develop the exchange.
After having made the crypto community wait for a year since ICE’s announcement of its plans to create the platform, Bakkt is finally set to launch in September, as per Bakkt’s medium blog.
Here are 5 reasons why Bakkt’s launch is such a big deal for the crypto community
- Bakkt’s Wall Street Connection – Bakkt has been founded by the creator of the largest stock exchange in the world, the New York Stock Exchange. This bold initiative may also inspire other major stock exchanges in the world from crypto-friendly countries like Japan and Hong Kong to venture into offering regulated platforms for crypto-based assets.
- Bakkt’s Credibility – One of the reasons why new investors are reluctant about including crypto-based assets in their portfolio is the lack of trust in existing platforms. Bakkt, owing to being equipped with the New York state trust charter from the New York State Department of Financial Services (NYDFS) and approvals from Commodity Futures Trading Commission (CFTC), and its association with some of the biggest companies of the world, overcomes the obstacle of building trust. Thus, the platform is bound to attract investors that want to play safe in the cryptocurrency space.
- More Institutional Investment – The cryptocurrency space has been bereft of institutional investors because of the same reason – lack of institutional-grade infrastructure. According to bitcoin enthusiast Jake Chervinsky, ICE brings great credibility to the crypto space for large institutions. When institutional investors enter the crypto space, sooner or later, crypto-based assets are bound to get recognition as mainstream financial vehicles.
- Mainstream Adoption – Among Bakkt’s objectives is to facilitate seamless cryptocurrency usage in daily life. Though Bakkt hasn’t revealed a lot about its plans for achieving this objective, but word on the street is that Bakkt will help customers switch from paying with cards at malls and online to scanning their Bitcoin apps. One place where consumers will definitely be able to spend their bitcoin is Starbucks. According to Maria Smith, vice president, Partnerships and Payments for Starbucks, “As the flagship retailer, Starbucks will play a pivotal role in developing practical, trusted, and regulated applications for consumers to convert their digital assets into U.S. dollars for use at Starbucks.” This development, which will enable consumers to avail Bitcoin’s utility as a currency, is a major step towards increasing bitcoin adoption.
- A Gateway to a Basket of Bitcoin-based Offerings – Bakkt aims to enable major money managers to offer Bitcoin-based financial vehicles including mutual funds, pension funds, and ETFs, as highly regulated, mainstream investments. Bakkt’s vision can only be fulfilled if the US’ regulatory bodies are on the same page as Bakkt about digital assets. The SEC has been delaying its decision on proposed Bitcoin ETFs since the last year, and even now, it has pushed its decision to October. With the launch of Bakkt, the SEC might expedite its process of reviewing bitcoin-based assets.
How do you think that Bakkt will influence the cryptocurrency market? Share your views with us in the comments.