After dropping back below $10,000 on Friday, Bitcoin has surged over $1,000 (breaking out this morning) following news that the Bakkt exchange will be offering ‘physically-settled’ Bitcoin futures (as opposed to the cash-settled contracts that are currently traded).
In a blog post last Friday, Bakkt revealed the details of its bitcoin futures and warehousing plan.
One year ago, we announced our ambitious vision to bring institutional infrastructure to digital assets with an end-to-end regulated marketplace. That vision will be realized on September 23 when Bakkt launches custody and physically-delivered daily and monthly bitcoin futures contracts in partnership with ICE Futures U.S. and ICE Clear US.
Our contracts have already received the green light from the CFTC through the self-certification process and user acceptance testing has begun. Withapproval by the New York State Department of Financial Services to create Bakkt Trust Company, a qualified custodian, the Bakkt Warehouse will custody bitcoin for physically delivered futures. This offers customers unprecedented regulatory clarity and security alongside a regulated, globally accessible exchange in a market underserved by institutional-grade infrastructure.
Put simply, as CoinDesk’s Omkar Godbale notes, BTC futures trading on Bakkt will not rely upon unregulated spot markets for settlement prices and the party will receive delivery of bitcoins from the Bakkt Digital Asset Warehouse at the end of the contract period.
Many observers, including cryptocurrency analyst and trader Scott Melker, are of the opinion that Bakkt’s physically-delivered futures product will open the floodgates for the institutional money and is a long-term bullish development for bitcoin.
The @Bakkt news is arguably the most bullish event for institutional investors in the history of bitcoin. PHYSICALLY delivered futures (require the holder to either produce actual bitcoin or take delivery from the exchange) backed by the New York Stock Exchange. We are maturing.
— The Wolf Of All Streets (@scottmelker) August 16, 2019
Physically delivered futures require the actual purchase of bitcoins, which, according to Melker is a “huge” development. Also, there is general consensus that the price discovery in new physical delivery markets will contribute to building confidence in BTC prices.
Bitcoin breaking back out of its range…
Source: Bloomberg
Additionally, as CoinTelegraph notes, crypto markets are reacting to news cryptocurrency exchange Binance was planning to release its own version of Facebook’s Libra digital currency, in what is also a direct response to China’s central bank.
via ZeroHedge News https://ift.tt/31Q1MIw Tyler Durden