Why is Bakkt Important For Mainstream Adoption of Bitcoin (BTC)?

  • Bakkt get green light from CFTC, to launch Bitcoin futures contracts next month
  • Bitcoin Futures, Custody, Payments, & Compliance by Bakkt
  • One-day physically delivered BTC futures contracts traded on registered exchange big for Bitcoin

After a year of repeated postponements, we are finally going to have physically-delivered Bitcoin futures.

September 23rd is the day when Bakkt is launching its physically-delivered Bitcoin futures contracts after receiving the green light from the CFTC.

“Transparency and trust to digital assets,” is what Bakkt vows to bring to the cryptocurrency industry which is still in its early stages.

The digital asset platform launched by Intercontinental Exchange, a US company that operates 12 regulated exchanges and marketplaces is expected to be the beacon for the institutional investors.

Bakkt: Bitcoin Futures, Custody, Payments, & Compliance

In the decade long history of Bitcoin, one of the most concerning issues with the crypto industry is the wild swings in prices of crypto assets.

This kept the institutional investors at bay though they have started to make their way in crypto space. But with ICE backed Bakkt making its way into the market while adopting practices employed in the global futures market, more interest from institutions is expected.

Bakkt is partnering with ICE’s leading futures exchange and clearing infrastructure to bring its physically delivered futures contracts to market participants in more than 30 countries. These participants will undergo AML/KYC rules consistent with CFTC-regulated markets.

In addition, “Bakkt will routinely participate in financial and security audits, as well as regulatory compliance reviews.”

As for the custody, it provides secure storage backed by insurance for digital assets held in frozen wallets. Moreover, they are working with leading merchants who recognize the potential of crypto-assets as these new global currencies evolve beyond speculative assets and or a store of value.

A way for large, risk-averse institutions to buy & custody bitcoin

Crypto market is largely designed to serve retail customers rather than institutional participants and Bakkt is bridging the gap — concerns related to lack of regulation, liquidity, market quality, fees, and operational risks — to access this market.

“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,” said Jake Chervinksy, General Counsel of Compound Finance.

Most notably, these bitcoin futures are physically settled contracts, unlike 98% of futures in the finance industry.

Bakkt is offering an innovating one-day futures contracts, traders will thus take delivery meaning it will be similar to trading spot, as explained by economist and trader Alex Kruger.

The fact that these futures will be traded on a fully regulated exchange, is huge to attract institutions and:

“could thus be an extremely bullish development IF demand is there.”

Bitcoin price meanwhile reacted somewhat positively to the news as we went above $10,500. But BTC/USD is yet again in the red by 0.54% while trading at $10,345.

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Author: AnTy

Chief Innovation Officer of LabCFTC, Daniel Gorfine to Step Down to Pursue Goals Within the Private Sector

Chief Innovation Officer of LabCFTC, Daniel Gorfine to Step Down to Pursue Goals Within the Private Sector

On Friday, August 2, 2019, the U.S. Commodity Futures Trading Commission (CFTC) announced that their first-ever Chief Innovation Officer (CIO) and Director of LabCFTC, Daniel Gorfine will be leaving his position to pursue his goals within the private sector.

Gorfine who started his journey with the commission in 2017, was the one to have developed and led LabCFTC, which was described as an endeavor that required, “facilitating market-enhancing innovation, informing policy and ensuring that the CFTC has the regulatory and technological tools,” in keeping up with the ever so evolving the 21st century.

CFTC’s Chairman Health, P. Tarbert is saddened by the news, adding that,

“[Daniel] is a thought leader in the federal government on financial technology issues.”

Furthermore, it seems like P. Tarbert will be the one taking over, as he reported that he is:

“Fully committed to building on the firm foundation Dan has built to further elevate, advance and modernize how we think about applying a sound, principles-based approach to promising new technologies.”

Commissioner Brian Quintenz highlighted many of Gorfine’s strong suits, adding that,

“[Daniel’s] capacity as the Chief Innovation Officer for the Commission and Director of LabCFTC […] has positioned the CFTC at the forefront of the intersection between technological innovation and financial regulation.”

Gorfine has since expressed gratitude in having been able to work along with the likes of Chairman Tarbert, former Chairman Giancarlo and everyone else, adding that he is,

“proud of the work we have done, inspired by innovators we have met.”

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Author: Nirmala Velupillai

LedgerX’s Physically Settled Bitcoin Futures Have Not Been Approved by CFTC Yet

LedgerXs-Physically-Settled-Bitcoin-Futures-Have-Not-Been-Approved-by-CFTC-Yet
  • The CFTC has not approved the launch of LedgerX’s Omni platform.
  • Previous reports from The Block and others reported that the bitcoin futures had been launched, following a tweet from LedgerX.

Yesterday, reports came out that LedgerX was finally launching the physically delivered bitcoin [BTC] options and custody that they had been working on, according to The Block. In the original report, The Block had spoken previously with LedgerX’s CEO, discussing the way that this product would open doors for institutional investors. While these previous reports showed accurate information about what the public can expect from the new product, the launch has not happened.

The Block reported on the current situation, correcting their previous statements. Instead, the publication is now claiming that the current state of the launch is “unclear,” and that the futures contracts do not appear to be going live anytime soon, as the Commodities Futures Trading Commission (CFTC) has already stated that they’ve not approved the launch, according to statements released to CoinDesk.

Many publications reported on an announcement from LedgerX, dated July 31st, that the Omni trading platform already had physical futures offering live. However, based on information from the CFTC, that is impossible. On Twitter, a derivative specialist named Thomas G. Thompson said that “the CFTC does not show any futures contracts certified by” the authority. While it is possible that their existing swaps were launched on the new futures platform, he added that this is “still [an] important development.”

The reporter with The Block stated that there’s no reported trade volume at this point, according to an anonymous industry leader, which suggests that the launch didn’t happen. However, on the official Twitter account for LedgerX, the company invited users to sign up to receive “early access” to Ledger OmniX.

Yesterday, LedgerX had tweeted that they were “live with retail trading on Omni.” However, the tweet has since been deleted. The screenshot, pulled from reports from The Block, can be seen below.

https://www.theblockcrypto.com/wp-content/uploads/2019/08/LedgerX-287x450.png

https://www.theblockcrypto.com/wp-content/uploads/2019/08/LedgerX-287x450.png

LedgerX originally revealed in April that they were working to offer Bitcoin futures, following their filing with the CFTC in November 2018 for the requisite licenses. Last month, the CFTC provided LedgerX with a designated contract markets (DCM) license, offering the final approval that it needed. While approval processes have been complete, a launch date has not officially been announced.

Along with LedgerX, Bakkt is already working with the CFTC to obtain a trust charter from the New York Department of Financial Services. Bakkt would most likely launch within a few weeks of having this trust charter approved.

ErisX, much like LedgerX, has received the approvals that they need, but no launch date or other timeline has been made available for their futures contracts. Cryptocurrency spot trading started being offered by ErisX in April of this year.

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Author: Krystle M