The much anticipated Bakkt âBitcoin [BTC] futures contractsâ is scheduled for launch on 23rd September 2019. While these are not the first regulated Bitcoin [BTC] futures contract with BitMEX and CME currently leading the space, Bakktâs is one-up on all existing platforms.
The Bakkt contracts will be margined and as mentioned before â can be settled using Bitcoins itself. Hence, it can also be used as an alternative to unregulated spot markets as it has custody arrangements as well. Moreover, Bakkt will offer:
â¢ Bakkt Bitcoin (USD) Daily Futures
â¢ Bakkt Bitcoin (USD) Monthly Futures
The CME provides only monthly Bitcoin Futures contracts. The daily contracts would likely increase the volatility in the everyday price of Bitcoin. Nevertheless, the regulated platform will improve the fundamentals around Bitcoin [BTC] massively.
Rhythm, a crypto-trader talked about the advantage of Bakkt over CME and its effect on Bitcoin markets, he tweeted,
Unlike other futures exchanges, this is settled in bitcoin. Actual bitcoin is paid out, not just the fiat equivalent to the price of bitcoin.
The result is better price discovery and liquidity for bitcoin.
Kelly Loeffler, the CEO of Bakkt, told the media, that theÂ core service Bakkt will offer is âsecure, regulated custody,â alongside its institutional-scale trading.
The monthly futures contract on Bakkt is based onÂ âforward pricing curveâ for investors, giving them an option to see prices up to 12 months. She specifically talked about the halving schedule due next year; which will be enabled for speculation through the monthly contracts.
Furthermore, as the daily contracts are margined, it will provide a lot of space for institutional money to get involved in the day to day activities around it.
The Bakkt launch data announcement has had an extremely positive effect on the Bitcoinâs price. The price of Bitcoin at 3: 30 hours UTC on 20th August 2019 is $10,800. Bitcoin has gained about 6% since the announcement.
Do you think that daily futures contracts will increase the volatility or decrease it? Please share your views with us.Â
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