Bitcoin Stored in Bakkt Warehouse Covered by $125M Insurance
Bakkt, the Bitcoin futures trading platform backed by NYSE parent Intercontinental Exchange (ICE), announced on Monday that its custody service is now live and protected by an insurance policy worth $125 million.
Bakkt Warehouse is Now Active
The operator of the first Bitcoin futures platform with physical deliveries said in a Monday tweet that it was already holding client’s crypto funds.
The Bakkt Warehouse is active for futures
Bitcoin deposited at our Warehouse is protected by a $125 million insurance policy
— Bakkt (@Bakkt) September 9, 2019
While Bakkt’s custody service has been available since September 6, the company plans to launch the platform on September 23. Last Friday, ICE’s subsidiary announced the official launch of its warehouse via Twitter:
The Bakkt Warehouse opens today. It is regulated by the New York State Department of Financial Services (NYDFS) as a Limited Purpose Trust Company, providing customers with a Qualified Custodian of bitcoin.
The news hasn’t boosted Bitcoin’s price as of late Monday. The largest cryptocurrency by market cap has declined by 1.50% in the last 24 hours as of 06:00 PM UTC. Currently, the digital currency is trading at around $10,287.
When or if Bakkt launches in two weeks from now, it will become the first Bitcoin futures trading services with physical delivery, suggesting that customers will deal with actual Bitcoin. It’s worth mentioning that Bakkt’s clients will comprise institutional investors only.
Elsewhere, there are already Bitcoin futures trading services offered by Chicago-based CME, though the contracts are settled in cash and no physical Bitcoin is involved. CME’s rival Cboe used to provide similar trading solutions, though it decided to halt its Bitcoin futures products for a while.
It’s Been a Long Time
Bakkt first announced its platform in the second half of last year. However, the company postponed the launch several times, as it wasn’t ready to provide Bitcoin futures in a bearish market. Meanwhile, Bakkt has secured regulatory approval and is ready to deploy the first futures contracts.
Institutional investors will feel safer about their crypto funds as Bakkt uses a $125 million insurance policy.
Do you think the Bakkt launch will move Bitcoin’s price by the end of September? Share your thoughts in the comments section!
Images via Shutterstock, Twitter: @Bakkt