Backed by major players like the Intercontinental Exchange (ICE) and Microsoft, Bakkt has emerged as a pioneering force in the bitcoin futures and digital asset infrastructure space. The platform recently secured $300 million in Series B funding, signaling strong institutional confidence despite global economic challenges. Here’s what makes Bakkt a standout in the cryptocurrency ecosystem.
1. Institutional Backing and Trust
Bakkt is a digital asset platform launched by ICE in August 2018, designed to facilitate secure trading, storage, and payments for cryptocurrencies. Key investors include:
- ICE (Intercontinental Exchange)
- Microsoft’s M12 venture fund
- Pantera Capital
- PayU and other fintech leaders
With ICE’s infrastructure and regulatory expertise, Bakkt addresses institutional concerns around custodial services and compliance, offering a trusted gateway for large-scale investors.
2. The First Physically Delivered Bitcoin Futures
Bakkt made history by introducing the first physically settled bitcoin futures, a stark contrast to cash-settled alternatives like CME’s. This means:
- Investors receive actual bitcoin upon contract expiration.
- Reduces market manipulation risks by tethering contracts to real assets.
- Enhances price transparency and reduces volatility.
👉 Explore how bitcoin futures work
3. Overcoming Regulatory Hurdles
Originally slated for January 2019, Bakkt’s launch was delayed due to CFTC approvals and regulatory scrutiny. It finally went live in September 2019 amidst a bear market, proving resilience in a tough climate. Early challenges included:
- Low initial trading volume compared to CME.
- Investor hesitancy toward physical settlement versus cash-settled contracts.
4. Expanding Services: Custody and Beyond
To broaden its appeal, Bakkt secured NYDFS approval for:
- Bitcoin custody services for institutional clients.
- New futures options and loyalty-points conversion programs.
- Partnerships with 7 of the top 10 financial institutions.
5. A Crypto Payment App for Mainstream Adoption
Bakkt plans to launch a digital wallet app in summer 2024, enabling:
- Seamless conversions of crypto, miles, and rewards into spendable cash.
- Integration with Apple Pay and Android Pay merchants.
- Real-time tracking of loyalty points and assets.
CEO Mike Blandina emphasizes this app will "unlock the value of digital assets" for everyday users.
FAQs About Bakkt
Q: Who owns Bakkt?
A: Bakkt is a subsidiary of Intercontinental Exchange (ICE), the parent company of the NYSE.
Q: How is Bakkt different from other crypto exchanges?
A: Its physically delivered futures and ICE-backed custody services cater to institutional investors.
Q: Can individuals use Bakkt’s services?
A: Yes, the upcoming payment app will target retail users.
Q: What’s the significance of the $300M funding round?
A: It validates Bakkt’s role in bridging traditional finance and crypto markets.
👉 Learn more about institutional crypto adoption
Bakkt’s blend of regulatory compliance, institutional trust, and innovative products positions it as a key player in the future of digital asset trading. Watch for its payment app’s launch—it could be the catalyst for widespread crypto utility.