On September 23, Bakkt launched physically-settled bitcoin futures contracts. Before that, many people believed that its launch would bring the price of Bitcoin to da moon.
Looking at it now, is it still the case?
What do you think?
What do you think?
If you believe what economists have been doing over the past few decades, you don't get this idea: Futures affect the price of the underlying asset.
Many cryptocurrency traders disagree with this statement, claiming that whales will use futures contracts to manipulate the market. In fact, researchers at the Federal Reserve made the same claim about the 2018 Bitcoin bear market.
Who do you think is right? economist? Arrogant Trader? Or Bitcoin-hating Central Bank?
I don't know your answer, but at the moment, the launch of Bakkt has no effect on the price of Bitcoin or cryptocurrencies. If the price goes up in the future, it must be something else.
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(Fidelity Investment Survey: 22% of institutional investors own digital assets)
Meanwhile, Yale University, the Massachusetts Institute of Technology, Harvard University, the University of Michigan, the Fairfax County Pension Fund in Virginia, the Rockefeller family office, and many other large investors have said they own some bitcoin.
In addition, U.S. regulators have also approved Wall Street firm ErisX's physically-settled futures, Fidelity has provided custody services to large investors, and Goldman Sachs has a subsidiary in the cryptocurrency market. Nasdaq owns an exchange. Swiss and Japanese financial institutions have entered even deeper into the cryptocurrency market.
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Boost the market?
There is a saying in the market that since Bakkt is a physical delivery, traders on the platform will have to buy a large amount of bitcoins in the market at that time. According to the relationship between supply and demand, the price of bitcoins will be pushed up.
According to this logic, is it possible for Bakkt to hoard a large amount of "cheap" bitcoins before its launch?
But on September 6, 2019, Bakkt initiated a $1 billion Bitcoin transaction-coincidentally, on the same day, Bakkt announced that it would start accepting deposits. Those bitcoins were transferred from Bakkt's private account to active wallets, according to people familiar with the matter. In response, Bakkt said: "No comment."
If this is the case, then the bitcoin in Bakkt's hand has been withdrawn from the market.
For those recipients of bitcoin futures contracts, they are just speculators in the market and have no obligation to keep bitcoins. In the whole process, Bakkt's role is only to ensure that buyers and sellers abide by their trading rules, and cannot decide at all market direction.
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Behemoth enters
While some exchanges have a strong reputation, few have the combination of background, expertise, trading infrastructure, and professional network that Bakkt has.
It’s like Coinbase with derivatives, investment products, and business services, with a dedicated market monitoring team and government relations to ensure smooth operations in full compliance with US law.
Bakkt's parent company Intercontinental Exchange (ICE) has the world's largest and most successful stock and commodity markets. Those involved at Bakkt have decades of experience in traditional finance. Backers of Bakkt include Horizon Ventures, M12, PayU, Pantera Capital and Boston Consulting Group, and Starbucks even signed a partnership agreement.
In addition to ICE executives with exposure to traditional markets, Bakkt's leadership includes financial professionals and advisors from the cryptocurrency space.
Bakk raised $182 million in investment funding to buy an office from Rosenthal Collins Group. It is building a new market from zero to one with one goal: to dominate the cryptocurrency market in the same way that its sister company, the New York Stock Exchange, dominates the stock market.
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FOMO arrives late
According to the survey, 47% to 76% of professional fund managers want to invest in Bitcoin. But they will not deposit $50 million into a Binance account, and they will not wire the money to Gemini, the legal department will not allow them to do so. But what about Bakkt? They are a sister company to the NYSE and are the legal way to go.
While this will bring some new money into the market, you won't notice. Big money tends to smuggle through private networks for a variety of reasons.
Also, they are usually not HODL. These guys are investing masters, and they're always moving money in and out of the market, either directly or through derivatives (sometimes both).
Bakkt provides another playground for them, but its plans go far beyond professional investors. As ICE’s CEO puts it, it’s a “moonshot feat” that will bring cryptocurrencies to the masses.
In addition to its partnership with Starbucks, Bucket has begun holding education and training sessions for potential customers, hoping to spread the FOMO sentiment through word of mouth.
Assuming Bakkt can clear the hurdles of each institution, it will bring its own service to the mass market, along with a lot of money, influence, expertise, credibility and publicity.
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change your mind before making money
Bakkt's cooperation with Starbucks, its traditional industry background, its close relationship with regulators, its professionalism, responsibility, experience...all of these create a trustworthy image-this is what makes the mainstream people take it seriously. What it takes to look at cryptocurrencies.
In the next year or two, you'll probably start hearing people say, "Cryptocurrency is safe now, the government regulates it, and you don't have to worry about fraud, hacks, and exchanges stealing your money." Of course, there are risks — — Never invest more than you can afford to lose — but this is not a Ponzi scheme or a scam.”
And this underlying belief gives those people who are interested in cryptocurrencies a reason to enter the market, whether they buy Bitcoin or altcoins, no one knows what will happen in the future, but at least it is safe and profitable now Opportunity.
By that time, cryptocurrencies will attack from a niche group of 40 million people (based on the number of Bitcoin wallets) to a broad group of 500 million people who already own some kind of financial investment product.
(Original: Mark Helfman | Compilation: Mashaka)
