The leading cause for concern of many Bitcoin supporters has been the mainstream adoption of the digital asset and its application in various avenues of global economics. The latest news revealed by Kelly Loeffler, the CEO of Bakkt seems to have boosted the industry in the right direction after the official announcement that the much-awaited institutional platform will be launched on September 23rd of this year.
This comes in the wake of the platform receiving the go-ahead by the United States Commodity Futures Trading Commission [CFTC] which the entire community has been waiting for since the start of 2019. The official Baktt blog stated:
“Our contracts have already received the green light from the CFTC through the self-certification process and user acceptance testing has begun. With approval by the New York State Department of Financial Services to create Bakkt Trust Company, a qualified custodian, the Bakkt Warehouse will custody bitcoin for physically delivered futures.”
Post the release of the news the community ahs begun speculating as to how such a launch will benefit the world’s largest cryptocurrency as well as the rest of the digital asset market. The price of Bitcoin was the first positive responder in the wake of the news, with Bitcoin price crossing the $10,000 threshold. The market cap of Bitcoin has gone up too, climbing to notch a healthy $186.95 billion.
Many others in the cryptocurrency space have also tried to pinpoint the exact effects of the entry of such an institutional product in the cryptocurrency industry with Jake Chervinsky, the General Counsel at Compound Finance tweeting:
“Why is @Bakkt important for adoption of bitcoin?
A: It offers a way for large, risk-averse institutions to buy and custody bitcoin through an end-to-end regulated system approved by the CFTC and NYDFS, and backed by the sterling reputation of ICE. Compliance lawyers rejoice!”
The dominant sentiment that has put the Bakkt launch at such a zenith is the fact that for the first time, Bitcoin will be an asset that has passed the CFTC microscope and the tag of ‘non-regulated asset’ cannot occur it.
Being backed by the Intercontinental Exchange has also bolstered Bakkt’s chances of survival with Kelly Loeffler assuring users and holders that Bakkt will comply with the highest standards of security.
Security and privacy have always been touted as the main reasons why regulatory bodies have shirked away from Bitcoin, but with the launch of the Bakkt Warehouse, the company aims to put those fears to rest. According to Loeffler:
“The Bakkt Warehouse, which is part of Bakkt Trust Company, is built using the cyber and physical security protections that support the world’s most actively traded markets, including the NYSE. In addition, the independent governance and compliance requirements of a qualified custodian mean that the Bakkt Warehouse is designed to meet the highest standards of oversight.”
Another major win that goes hand in hand with the Bakkt launch is the speculated push on the SEC towards the good side of crypto. Despite the best efforts of various digital asset organizations and companies, the Securities and Exchange Commission [SEC] has not budged from its negative stance on Bitcoin, but maybe the September 23rd launch will change the mindset of the SEC honchos. As put forth by Chervinsky:
“It [Bakkt] cracks the door open. I expect Bakkt will need to generate significant volume to make a difference for the SEC’s requirement of “a surveillance-sharing agreement with a regulated market of significant size,” but it’s a big step in the right direction for sure.”
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