Many observers see institutional investors as the only hope for the crypto market to rise up once again. In fact, many are quite optimistic about the market today. Despite Bitcoin only trading at around $6,200 to $6,500 for some time, it has been seen as a good sign by many experts. Many believe that people are holding on to their Bitcoin waiting for the next regulatory decision to happen.
Regulatory problems may have brought Bitcoin’s price down. But 2018’s story is regulatory changes from different parts of the world. And because of this, institutional investors are slowly entering the market. You have the possibility of having a Bitcoin ETF. Though the SEC delayed their decision yet again, there is still the VanEck and SolidX Bitcoin ETF application initiative that could make it easier for institutional investors to participate.
Should We Be Optimistic About Bakkt?
Also, you have the likes of Bakkt. As explained by ICE Digital Asset head and Bakkt CEO Kelly Loeffler, Bakkt is basically a platform for merchants, institutions, and consumers to trade, store, and spend their cryptocurrencies.
This is seen as big news considering that ICE has been the operator of the biggest stock market in the world. It also has a solid reputation in the finance sector and the Commodities and Futures Trading Commission (CFTC). By merely filing a license before its launch on December 12, Bakkt can already provide Bitcoin futures.
Jake Chervinsky who is a government defense and securities litigation attorney at Kobre & Kim LLP thinks that there are some positives about Bakkt entering the crypto market. However, he also believes that the impact is yet to be determined. Despite the fact that Bakkt is considered as a major catalyst that could bring another bull run, he thinks that it is premature to conclude that Bakkt can do such. He said that “In the minds of many, Bakkt’s launch has become a full-fledged narrative for when & how the bear market will end. It plays the same role as bitcoin ETFs as a trusted vehicle to bring that sweet institutional money into the space, but without all the trouble of SEC approval”.
What Makes Bakkt Different?
Bakkt will physically deliver BTC to the buyers. This means that it will also have an impact on the supply of Bitcoin as well as its price. He said that “ICE entering crypto feels like a big deal. It’s an established, respectful & powerful player in the finance industry. In other words, large institutions trust ICE with their money, including those institutional investors who many people think are key to the next bull run. Also noteworthy is the fact that Bakkt will custody & deliver real bitcoin. That means institutional inflows would replace supply & thus (maybe) increase price too”.
There are a number of variables that are at play in order to ensure the successful growth of Bakkt. The first phase is to offer Bitcoin futures. Next, you also have a consumer payment application that will allow the likes of Starbucks to process Bitcoin payment without any problem. Is Bakkt’s partnership with Starbucks and Microsoft already enough?