Intercontinental Exchange-Owned Cryptocurrency Startup Bakkt Confirms Its First Product: Bitcoin Futures


Bakkt, a digital currency financial startup launched in August by Intercontinental Exchange (ICE) has confirmed that its first product will be physically-delivered Bitcoin futures contracts. They plan for these to be available to the public this November.

Bakkt was launched in August by the Atlanta-based ICE in conjunction with partners including Microsoft, Starbucks and Boston Consulting Group to create a “global, regulated ecosystem for digital assets.” Essentially, the financial giant, which owns the New York Stock Exchange (NYSE) and 22 other global exchanges, wants to help regulated institutions — and eventually, everyday consumers — more easily benefit from the cryptocurrency market. 

In a Tweet, Bakkt said that their futures will be delivered against the U.S. dollar, British pound and the euro, at least. “For example, buying one USD/BTC futures contract will result in daily delivery of one Bitcoin into the customer’s account,” the company tweeted.

Thus far, the startup’s public communications have focused largely on institutional customers. Indeed, ICE’s adherence to risk-lessening measures such as security standards and reporting is aimed to reassure institutional investors looking to profit from digital currency — and simply to make the world of cryptocurrency more understandable. 

In a blog post, Bakkt CEO Kelly Loeffler said that the company’s framework will be similar to that of any other futures market, such as those for coffee, oil, etc. Important to this, she said, is the element of “physical delivery.”

“This supports market integrity and differentiates our effort from existing futures and crypto exchanges which allow for margin, leverage and cash settlement. Coupled with a secure, regulated warehouse solution, you can begin to see how this market infrastructure can help more institutions and consumers participate in the asset class,” Loeffler wrote.

Response to Bakkt has been mixed, with one camp claiming its mission goes against the purpose of cryptocurrency’s deregulated economy, and another asserting that this will give Bitcoin and other crypto-assets more legitimacy — and possibly value — on the market.

Bakkt hasn’t released any official statements on what’s next, but a Fortune interview of Loeffler and ICE CEO (and her husband) Jeff Sprecher hinted at the possibility of cryptocurrency-based IRAs, 401(k) plans, and even Bitcoin retail payments.