Representatives of Bakkt told in their blog on Medium about plans to launch Bitcoin futures contracts in early July, developed by the platform together with ICE Futures U.S. and ICE Clear US.
According to the publication, Bakkt worked closely with the Commodity Futures Trading Commission (CFTC) to develop contracts that comply with US regulation and customer needs for trade, as well as market transparency and certainty. According to Kelly Loeffler, CEO of the platform, customers actively working in cryptocurrency markets have the right to vote when developing the concept of the initial product offer.
The application submitted by ICE Futures to the CFTC states that Bitcoin futures will appear in the listing on the regulated exchange in the coming months. Loffler notes that over the next few weeks, the company will work with clients to prepare for user acceptance testing (UAT) of futures and custodial services.
As Löffler points out, new Bitcoin futures contracts were created as a result of consultations with stakeholders and offer unique trading, security and risk management functions. So, in the listing there will be two new futures contracts: bitcoin futures with daily settlements that allow customers to make transactions in the market on the same day, and a monthly bitcoin futures contract that will allow trading in the next month of closing the contract and through the forward pricing curve.
Pricing in these contracts will be supported by proven tools for identifying abuses and destructive trading practices, including fictitious transactions. This means that the estimated prices for ICE Futures U.S. will be based on prices found in Bitcoin Bakkt futures contracts, excluding unregulated cash markets.
Futures contracts will be margined by ICE Clear US, including the collection of initial margin security and variation margin for risk management. This approach is consistent with capital-efficient risk management practices in global futures markets, from oil and gold to interest rates and stock index futures.
In addition, Bakkt will contribute $ 35 million to the risk fund of the clearing center. According to Löffler, in this way, the company puts its capital on the line and confirms its own interests regarding the integrity and security of the market.
For the supply and safe storage of Bitcoins, a qualified custodian Bakkt will provide a comprehensive depository service, subject to regulatory approval. Storage will be supported by insurance, cybersecurity measures and full compliance with laws, including a program to combat money laundering and analytics blockchain.
As previously reported, Bakkt is in talks with the New York State Department of Financial Services to become a trust company and work as a qualified custodian of digital assets, along with CFTC-regulated futures products. The result of this work will be to ensure reliable storage of Bitcoin futures.
In conclusion, Loffler noted that the Bakkt team continues to expand. The company recently joined Marc D’Annunzio as a General Counsel who will lead legal and regulatory matters.
Also last month, Bakkt’s Operations Director spoke about the development of infrastructure for cryptoactive assets. Recall that initially ICE planned to launch the Bakkt platform in November 2018, then the launch date was postponed to mid-December, and a little later - to January 24th. However, on the eve of the New Year, the launch of the platform was postponed indefinitely. At that time, ICE stated that the launch date "will be changed in accordance with the decision of the CFTC".