Bitcoin based Bakkt Platform Moves to Acquire Bitlicense in New York: Bloomberg Report

By Nivesh Rustgi
Published April 18, 2019 Updated April 18, 2019
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Bitcoin based Bakkt Platform Moves to Acquire Bitlicense in New York: Bloomberg Report

By Nivesh Rustgi
Published April 18, 2019 Updated April 18, 2019

Intercontinental Exchange Inc., the parent company of the New York Stock Exchange (NYSE), had announced the Bakkt Platform which was supposed to be launched in December 2018. However, due to delay in regulatory approval from the Commodity Futures Trading Commission (CFTC) in the US, the launch has been delayed ever since.

Bakkt platform is a revolutionary product built on Bitcoin. It would provide Bitcoin futures contract which would be settled in Bitcoin instead of the US dollar. When Bakkt’s one-day contracts expire, they will be paid out in Bitcoin tokens instead of U.S. dollars. Hence, the biggest concern of the approving authority is custody and money laundering.

Kelly Loeffler, the CEO of Bakkt platform noted in her recent blog post that:

“New product launches require solving for unknown variables, and I’ve seen first-hand that addressing these challenges can help clear the path for healthy, long-term growth.”

ICE Move to New York Department of State Financial Services (NYDFS)

Bloomberg reported from its sources that the other significant roadblock is that traditionally to offer derivatives trading the clearinghouse or platforms must deposit the margin or initial amount from the customer in a bank. Hence, CFTC is concerned over how the and where the funds would be managed if they are Bitcoins.

Moreover, this involves custody of Bitcoin on two levels, one for the clearinghouse to settle the transactions and for the trade orders of Bitcoin Futures.

Reportedly, the owner of ICE has suggested procuring a BitLicense from the State authority to allow for custody of Bitcoin. Moreover, the NYDFS has granted a license to several Exchanges and Trusts like Winklevoss’s Gemini Trust, brokerage firm Tagomi and Bitstamp, a crypto-FIAT exchange. However, Bakkt platform is an application based request for custody; i.e., the bitcoins will not be traded as it is, but other derivative products and payment modules will be built on it.

The approval from the State authority would not confirm the launch of Bakkt platform as the ultimate deciding authority would still be CFTC for Bakkt to launch Futures contracts, and other applications based on Bitcoin. Moreover, initially, it might be made available only to institutional ‘high-volume’ investors.

Furthermore, Bakkt also aims to enable retail payments to popular brands like Starbucks; the Bakkt platform would provide for conversion of Bitcoin to FIAT instantly to make payments.

Will Bakkt platform aims to offer a plethora of applications on Bitcoin. Do you think it will successfully launch any time soon? Please share your views with us.  

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Nivesh Rustgi
1181 Articles
Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)

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