Several days remain before the launch of the regulated Bakkt trading platform, which will bring large institutional investors and their money to the market.
Paradoxical as it may sound, the vast majority of participants in the cryptocurrency market very much hope that the cost of the main cryptocurrency will quickly rise above $ 100,000. Will the hopes of the crypto community come true? Research from PrimeXBT.
What is Bakkt
The Bakkt cryptocurrency platform was created by ICE, the transcontinental operator of the largest exchanges and clearing houses for stock and commodity markets in the USA, Canada and Europe. The company is considered the world’s largest operator of the derivatives and stock markets, where futures contracts for energy, currencies, precious metals and other goods are traded. About 50% of the global trading volume of futures contracts for oil and oil products is concentrated on ICE trading floors. The most famous platform led by ICE is the New York Stock Exchange (NYSE).
ICE is a giant exchange industry with a long history and impeccable reputation, trusted by the trillions of dollars of the largest investors and corporations in the world. The launch of a cryptocurrency platform from such a company will potentially allow to attract colossal capital to the cryptocurrency market.
Bakkt is a cryptocurrency platform for trading deliverable Bitcoin futures. Futures delivery time is set on a daily and monthly basis. In addition to trading futures, custodial storage of cryptocurrencies is available to customers. This Bakkt differs from other trading platforms, the same CME (Chicago Mercantile Exchange) that it will trade in delivery contracts, and not settlement. That is, by making a purchase of a Bitcoin futures in the morning, in the evening the investor will receive it on his account in the Bakkt depository. Physical deliveries of bitcoins will allow you to evaluate the real daily and monthly trading volume.
Among the first partners and investors of the platform there are the world’s largest technological, consulting and retail giants: Microsoft, the Boston Consulting Group and Starbucks, as well as a number of large investment and other companies: Pantera Capital, Fortress Investment Group, Eagle Seven, Galaxy Digital, Protocol Ventures, Susquehanna International Group and Horizons Ventures
On September 6, Bakkt announced the start of acceptance of bitcoins for storage before the start of trading, and even earlier, in mid-August, the platform began to accept deposits from customers and already in the first hours of the bitcoin network a record transaction was recorded worth more than $ 1 billion, which is here They also connected with the launch of the platform. There was talk about the launch of Bakkt back in 2018, but the official launch was constantly delayed due to lack of permission from the regulators and only in August 2019, the CFTC finally issued permission to the platform, which marked a new era in the history of cryptocurrencies – the arrival of institutional investors.
Here’s how Kelly Loffler commented on the launch of the Bakkt CEO platform:
“Bakkt is a scalable platform designed for institutional investors and trading companies that are interested in digital assets. We plan to build an open and transparent platform that will help unlock and transform the potential of digital assets in global markets and in trade. It is designed to make cryptocurrency investments safe and secure. ”
Why is the community waiting for Bakkt?
The crypto community is awaiting the launch of Bakkt, as it counts on an influx of capital into the industry, which contributes to the growth in the cost of bitcoin. It is not only a matter of banal enrichment at the expense of the new bullrun, the cryptocurrency industry during its existence has generated many successful and useful projects and initiatives that can change people’s lives for the better. Not without problems, but still, the industry and related projects benefit the global financial system. The arrival of institutional investors and the launch of a regulated platform from a giant such as ICE suggests that the industry was officially believed at the state level. The rising cost of bitcoin will unfreeze many other projects that have not yet thawed after the “crypto winter”, will lay the foundation for new projects and, of course, will make money.
The community is gradually preparing to launch the platform, updating mining equipment in order to manage to get as much bitcoin as possible, while the rate is still quite low. According to the CEO of the deVere Group consulting company, Nigel Green, the mark of $ 10,000 can now be considered the official bottom for the current value of bitcoin. It is difficult to argue with him, because for more than 2 months Bitcoin has been consolidating in the area of 9,500 – 10,500, forming a kind of triangle, compressing the spring, which is about to shoot and will probably shoot up. The support line at the level of 9,500 has already beaten the price 4 times, not allowing the main cryptocurrency to lose the gained positions.
As for mining, over the past three months, over 600,000 new ASIC miners have connected to the Bitcoin network. Since mid-June, the complexity and hashrate of the main cryptocurrency has increased by 60% and reached a new historical maximum. The prospects for a new bull rally are pushing miners to mine as much bitcoin as possible, in the hope that an increase in its value will pay off all the investment in equipment in the very near future.
In addition, from May 2020, it will become 2 times more difficult to mine bitcoin, since there will be no less than the expected halving or halving of the reward for the mined block. The cryptocurrency deficit will create a stir that will only strengthen the uptrend.
Additionally, an increase in the value of bitcoin will create another FOMO – the syndrome of lost profit. Investors and crypto enthusiasts will start to buy not only bitcoin, but also popular altcoins such as Ethereum, Ripple, Litecoin, EOS and others, which will also push them to a new rally.
Are investors interested in Bakkt?
Of course! Over the past year, trading in bitcoin futures on CME (Chicago Mercantile Exchange) has increased to 7,237 contracts. The growth from last year amounted to more than 132%, and on May 13, an absolute record was recorded – 33,677 contracts (~ $ 1.3 billion or 168 thousand BTC). Trading on CME is carried out by far from beginning online traders, but by professionals, large investors who are equally interested in supply futures, and not just settlement contracts.
In addition, in the context of the ongoing trade war between the US and China, as well as the approach of a recession in the global economy, Bitcoin several times showed signs of a protective asset, correlating with the dynamics of the gold rate at the time of negative news for financial markets. The correlation occurred only a few times and in the short term, which can be regarded as some kind of test on the part of investors on whether Bitcoin can be used as an asset-refuge. I want to believe that the verification of “digital gold” has passed.
Well, and perhaps the main argument about the presence of interest in Bakkt from the side of the institutional is the launch of Bakkt itself. It would not have taken place and would not even have been planned if there had been no interest in digital assets. ICE is a large and experienced company, which would not start to useless trash at a loss. To lobby the interests of the platform with one of the most respected regulators in the world (CFTC) and get permission to launch, without understanding what prospects open up for their own business, ICE would not.
What should ordinary traders and beginners do now?
Start stocking up with bitcoin and other cryptocurrencies, in anticipation of a new bullran, and also open long positions. At the same time, do not forget to insure possible risks, which way Bitcoin will choose before the start of growth is unknown, therefore it is better to be protected. If the trader has little capital, you can use margin trading with leverage up to 500x, for example, on the PrimeXBT cryptocurrency trading platform, significantly increasing the potential profit from the growth of bitcoin. In addition, there are several types of orders on PrimeXBT, including Stop Loss, Take Profit, limit and interchangeable orders that will help traders control the situation and, if necessary, instantly exit or enter the market. If you are not a fan of fundamental forecasting, you can use the wide range of technical analysis tools available at PrimeXBT.
Conclusion
The launch of the Bakkt platform on September 23, 2019 will be the most significant event in the history of bitcoin and the entire cryptocurrency industry, as the day when cryptocurrencies became an official and recognized financial asset. I would like to believe that this will only be the beginning of the promising future of the digital economic system.
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