Lawyer: Don’t Overestimate Bakkt’s Impact on the Crypto Market

bakkt crypto exchange

Jake Chervinsky, a government enforcement defense and securities litigation attorney at Kobre & Kim LLP, has stated that while there are some positives in the entrance of Bakkt into the crypto market, its impact on the emerging asset class is yet to be determined.

Throughout the past several weeks, Bakkt has been considered as a major catalyst for the next rally of Bitcoin and other major cryptocurrencies in the global market. However, as of November, it is premature to conclude that Bakkt will initiate the next big rally of the cryptocurrency market.

“In the minds of many, Bakkt’s launch has become a full-fledged narrative for when & how the bear market will end. It plays the same role as bitcoin ETFs as a trusted vehicle to bring that sweet institutional money into the space, but without all the trouble of SEC approval,” Chervinsky said.

Why Bakkt is Important to Crypto

Bakkt is a platform for institutions, merchants and consumers to trade, store and spend cryptocurrencies, as former ICE Digital Assets head and Bakkt CEO Kelly Loeffler explained, backed by ICE, the parent company of the New York Stock Exchange (NYSE).

Coinbase 2

As the operator of the biggest stock market in the world, ICE has decades of track record and reputation in the traditional finance sector, as well as the authorization by the Commodities and Futures Trading Commission (CFTC) to operate as a designated contract market with the ability to self-certify a futures product.

Hence, Bakkt has the ability to operate a Bitcoin futures market without direct approval from the CFTC. By merely filing a license prior to its launch on December 12, Bakkt can operate a Bitcoin futures market.

bitcoin price predictions
Source: Shutterstock

Dissimilar to existing Bitcoin futures market, ICE and Bakkt will physically deliver BTC to the buyers of Bitcoin futures contracts on Bakkt, which will have an impact on the supply of the dominant cryptocurrency, and most importantly, its price.

“ICE entering crypto feels like a big deal. It’s an established, respected & powerful player in the finance industry. In other words, large institutions trust ICE with their money, including those institutional investors who many people think are key to the next bull run. Also noteworthy is the fact that Bakkt will custody & deliver real bitcoin. That means institutional inflows would reduce supply & thus (maybe) increase price too.”

If the demand for BTC rises throughout the next two months and Bakkt does start to see strong demand from institutional investors, then the futures market of Bakkt could have a significant impact on the actual price of BTC.

Too Early to Get Excited

There still exists many variables and conditions to the successful long-term growth of Bakkt.

The Bitcoin futures market of Bakkt is the company’s first product and the start of the first phase of its development. Phase two, as Chervinsky explained, is expected to be a consumer payment application that allows companies like Starbucks, a backer of Bakkt, to process merchant payments with ease.

But, it remains unforeseen whether Bakkt has established a clear vision to target merchant adoption or to leverage the involvement of conglomerates like Starbucks and Microsoft in its business to expand its crypto venture aggressively.

“Phase two is a mystery. Bakkt hasn’t said what it is or when it’s coming. Given all the talk about ‘spending’ via Bakkt, I’m guessing it’s some type of consumer-grade payment system. Maybe the kind you’d use at Starbucks to buy coffee with bitcoin. We’ll have to wait and see.”

The first phase of Bakkt, which is the release of its futures market, has to be completed first to evaluate its potential impact on the asset class properly. Until the company release its plans to pursue its second phase of growth, it is too early to determine the effect Bakkt will have on the industry.

Images from Shutterstock

Follow us on Telegram or subscribe to our newsletter here.Advertisement

Lawyer: Don’t Overestimate Bakkt’s Impact on the Crypto Market 1
blank
About the author

E-Crypto News was developed to assist all cryptocurrency investors in developing profitable cryptocurrency portfolios through the provision of timely and much-needed information. Investments in cryptocurrency require a level of detail, sensitivity, and accuracy that isn’t required in any other market and as such, we’ve developed our databases to help fill in information gaps.

Related Posts

blank

E-Crypto News Executive Interviews


blank

bitcoin
Bitcoin (BTC) $ 39,225.00
ethereum
Ethereum (ETH) $ 2,360.72
tether
Tether (USDT) $ 1.00
binance-coin
Binance Coin (BNB) $ 319.14
cardano
Cardano (ADA) $ 1.34
xrp
XRP (XRP) $ 0.662810
dogecoin
Dogecoin (DOGE) $ 0.223008
usd-coin
USD Coin (USDC) $ 1.00
polkadot
Polkadot (DOT) $ 14.85
binance-usd
Binance USD (BUSD) $ 1.00
USD
EUR
GBP
bitcoinBitcoin (BTC)
$ 39,225.00
ethereumEthereum (ETH)
$ 2,360.72
tetherTether (USDT)
$ 1.00
bitcoin-cashBitcoin Cash (BCH)
$ 505.48
litecoinLitecoin (LTC)
$ 137.90
bitcoinBitcoin (BTC)
33.322,58
ethereumEthereum (ETH)
2.005,49
tetherTether (USDT)
0,849524
bitcoin-cashBitcoin Cash (BCH)
429,42
litecoinLitecoin (LTC)
117,15
bitcoinBitcoin (BTC)
28,530.38
ethereumEthereum (ETH)
1,717.07
tetherTether (USDT)
0.727352
bitcoin-cashBitcoin Cash (BCH)
367.66
litecoinLitecoin (LTC)
100.30

Automated trading with HaasBot Crypto Trading Bots

Crypto Scams

Cryptocurrency Exchanges
Cryptocurrency Exchanges and the Plague of Scams and Bans
June 29, 2021
blank
What Role Do Cryptocurrencies Play In The Era Of Ransomware Attacks?
June 9, 2021
Crypto Scams On The Rise As Market Enters Bull Cycle
Crypto Scams On The Rise As Market Enters Bull Cycle
December 22, 2020
Harpreet Singh Sahni perpetrated the Plus Gold Union Coin (PGUC) scam
Sydney Concert Promoter Harpreet Sahni Involved In $50M Crypto PGUC Scam
November 2, 2020
Mining City insists that it is legit
Mining City Refutes Claims By Philippines SEC Of Being A Scam
September 23, 2020

Blockchain/Cryptocurrency Questions and Answers

Short-Sell Cryptocurrency
How to Short-Sell Cryptocurrency: A Brief Overview
July 17, 2021
Klaytn
What Is Klaytn (KLAY) And How Does It Work?
July 16, 2021
Cryptocurrencies
Our Crypto Roundup Interview Asks- Do Cryptocurrencies Have a Future?
July 15, 2021
Solana
What Is Solana (SOL) And How Does It Work?
June 26, 2021
blank
What Is Plethori Platform And How Does It Work?
June 12, 2021


CryptoCurrencyUSDChange 1hChange 24hChange 7d
Bitcoin39,774 1.56 % 15.33 % 24.61 %
Ethereum2,376.8 0.51 % 9.90 % 24.72 %
Tether1.000 0.05 % 0.03 % 0.23 %
Binance Coin322.16 1.09 % 7.80 % 5.88 %
Cardano1.350 0.57 % 11.78 % 13.65 %
XRP0.6649 0.31 % 10.91 % 12.73 %
Dogecoin0.2244 0.52 % 13.77 % 21.76 %
USD Coin1.010 0.35 % 0.39 % 0.00 %
Polkadot14.97 1.63 % 10.78 % 17.20 %
Binance USD1.010 0.50 % 0.89 % 0.54 %

bitcoin
Bitcoin (BTC) $ 37,012.00
ethereum
Ethereum (ETH) $ 2,180.33
tether
Tether (USDT) $ 0.998365
binance-coin
Binance Coin (BNB) $ 302.35
cardano
Cardano (ADA) $ 1.23
xrp
XRP (XRP) $ 0.618120
usd-coin
USD Coin (USDC) $ 1.00
dogecoin
Dogecoin (DOGE) $ 0.201461
polkadot
Polkadot (DOT) $ 13.59
binance-usd
Binance USD (BUSD) $ 0.997024