Will ICE’s New Bakkt Platform Attract Institutional Investors?

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The Intercontinental Exchange (ICE) owns 23 exchanges. The New York Stock Exchange, which is the world’s largest, is amongst them. And now ICE opens a brand new Bitcoin (BTC) platform – Bakkt.

We’ve all been waiting for the influx of institutional investors and Bakkt’s purpose is to open the door wide for them.

Bakkt will launch in November and aims to become a fully regulated exchange with Bitcoin mutual funds, pension funds, ETFs etc. The partnership with the giants like Microsoft and Starbucks is supposed to help finally make Bitcoin become a currency used in everyone’s daily life.

Centralised?

The way the exchange is going to operate raises some questions, as it seems very similar to current markets. The “one-day futures” contracts will be used to trade BTC with a broker placing an order for their client.

This means that clients would have to entrust their private keys to the exchange. And that, in turn, suggests centralisation. Entrusting your private keys to an exchange, which will guard them heavily, may be a solution to a hacking risk, but certainly goes against the idea of cryptocurrency.

Placing any type of intermediary between the trading parties contradicts Bitcoin’s idea. That does not mean that the project is doomed – quite on the contrary, actually. It may help ease the transition from traditional markets to the cryptocurrency ones, for many.

But decentralisation is what will most likely prevail in the long run.

 

Images courtesy of Shutterstock.com

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