- Experts of the cryto industry agree: The launch of Bakkt will bring trust and acceptance for cryptocurrencies among institutional investors and the society.
- Whether the launch of Bakkt will have a positive or negative impact on Bitcoin’s price, however, cannot be predicted.
Tomorrow Bakkt, the cryptocurrency exchange operated by the Intercontinental Exchange (ICE), will officially launch. Many investors have high hopes that this will immediately bring fresh capital into the market and that Bitcoin’s price will rise in the short and long term. The offered Bitcoin futures are “physically” backed, which means that they are settled with the “real” Bitcoin.
For the use of Bitcoin futures, Bitcoin is therefore paid in and paid out again. This allows new money to flow into the market, although this is no guarantee for a rising or falling Bitcoin price. Many experts in the industry nevertheless see positive developments for the crypto market. This strengthens the trust in Bitcoin and other cryptocurrencies and significantly facilitates access to the crypto market for institutional investors.
John McAfee explains in a tweet that the launch of Bakkt can be the starting signal for a new adaptation wave (freely translated):
BAKKT goes live tomorrow. It is an institutionalized exchange so I won’t be using it, but institutions will feel a level of trust that they had not had. It could jump-start Ctypto adoption. But remember – it is the opposite of freedom’s movement.
The founder of Fundstrat and Bitcoin bull Thomas Lee is equally positive. He also describes that Bakkt can increase general trust in cryptocurrencies (freely translated):
I am very positive on
@Bakkt and it’s ability to improve trust with institutions to crypto.
On 09.09.2019 Bakkt announced the launch of Bakkt Warehouse, a custody solution for investors to keep their money safe in a trusting environment. Some companies did not enter the crypto market in the past because they did not have a sufficiently secure way to protect their assets. Coinbase and Ledger have been offering mature technologies for some time to store their customers’ funds in cold storages.
First Bakkt and then a Bitcoin ETF for a bullish future?
The Security and Exchange Commission (SEC) had rejected all previous Bitcoin ETF applications on the simple grounds that the market was not mature enough and that there was still a lot of regulation to do. Most recently, VanEck and SolidX withdrew their application without further justification, probably of the fear of another rejection.
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Traders and investors see the approval of a Bitcoin ETF as a great opportunity for fresh capital to flow into the crypto market and a resulting rise in Bitcoin’s price. The SEC has received two further applications from Bitwise and Wildshire Phoenix. Bitwise published a report explaining why the time is right for a Bitcoin ETF from Bitweise.
However, it remains to be seen in which direction the crypto market will turn.