Bakkt is About to Take Crypto Mainstream, Yet the Market is Panicking Over ETFs; Welcome to the Cryptocurrency Markets *Rolls Eyes*
Bakkt is un upcoming exchange by the Intercontinental Exchange ICE (the parent company of the New York Stock Exchange NYSE). This is pretty much the biggest crypto news of 2018, if not ever. I explain why.
- Bakkt is formed by one of the biggest players in terms of exchanges in the world, the Intercontinental Exchange ICE (an operator of global exchanges, clearing houses, data and listings services… including the New York Stock Exchange NYSE).
- Bakkt is led by Kelly Loeffler, ICE’s former head of communications from 2002 to 2018 (she left that position for Bakkt). Her previous role in ICE was impressive, and it bodes well for Bakkt.
- Bakkt has been being built for 14 months in secret (likely as a reaction to the growing crypto market).
- Bakkt is working with companies like Starbucks and Microsoft (meaning this is a partnership between some of the world’s biggest companies).
- Bakkt plans to dabble in many aspects of crypto. It’ll allow conversion between BTC and dollars at first (via Bitcoin “backed” contracts) and it’ll act as a custody solution, but plans to move into a variety of merchant and consumer applications. In short, it means Bakkt can potentially be used for everything crypto. It can be used to buy, sell, and store cryptos for your 401k, be used for crypto credit cards, be used to take payments as a business, etc.
- Since Bakkt does all that, it also essentially will double as a Bitcoin ETF replacement. Meaning the SolidX approval just got way less important. This is important because the market rallied over the potential ETF and then panicked and dropped when another ETF got rejected (the Winkelvoss ETF). However, this Bakkt news implies that none of that matters… because investors will have a way to invest in Bitcoin anyway. Even better, Bakkt is settled in Bitcoin. Where an ETF would just HODL Bitcoin, Bakkt will end up buying and selling it.
- To the above point, Bakkt actually paves the way for ETFs and other products to be approved, because Bakkt will provide a regulated US exchange and regulated US custody solution (two things that were lacking outside of Coinbase, which unlike Bakkt comes from the crypto space and not the traditional markets). So this could even lead to ETF approvals (all eyes are on the SolidX ETF for now, but there are other exciting proposals like the Direxion ones).
In other words, Bakkt is about to bring Bitcoin mainstream, becoming a one-stop crypto hub for retail investors (for both personal and retirement accounts), institutional investors, and businesses, and in doing so does everything a Bitcoin ETF would have done and much much more.
If you don’t get why you should be excited yet, see the official re-Tweet from @bakktapp below and let CNBC’s Brian Kelly explain:
— CNBC’s Fast Money (@CNBCFastMoney) August 3, 2018
NOTE: Right now the market is finishing up a bear cycle and panicking over the rejection of a Winklevoss ETF from two weeks ago. The result is that Bitcoin is nearing its 2018 low again (its at $6.9k, the low was $5.75k). I’m not sure how far the bears will be able to push it, I’m hoping very far so I can buy more cheap personally, but that seems overly hopeful given the news. Bakkt is really big news, and it is likely only a matter of time before the majority of people realize what is happening here. What you do with that information is up to you, but logically anyone who wants to be in Bitcoin would likely want to be in before the majority of Americans can add Bitcoin to their portfolios with the a click of a button (an event that could come sooner or later given recent announcements by Bakkt). 2018 is a bear, but the news is bullish. Hard to say what the end result will be, but easy to say this is a big deal. For more reading, see: The NYSE’s Owner Wants to Bring Bitcoin to Your 401(k). Are Crypto Credit Cards Next? Backed by Microsoft and Starbucks, Intercontinental Exchange is launching a startup called Bakkt to make the cryptocurrency safe for your retirement fund, and maybe for retail, too.