If you have been active in the cryptocurrency scene, you must have heard about Bakkt several times, especially when it comes to institutional investors. You see, since the explosion of cryptocurrencies and ICOs, institutions have been interested in investing in the crypto industry, but the volatility of digital asset prices and the risks involved tend to push them away.
Most of the institutions have been uncomfortable with interacting with the current exchanges, which are largely centralized and have a history of not complying with various government regulations. Now, this is where Bakkt comes in.
Let’s dig deeper and learn about this firm, and its impact on the prices of top cryptocurrencies.
Just What Is Bakkt?
Simply put, Bakkt is a company under the umbrella of Intercontinental Exchange (NYSE:ICE), which is a well-known operator of global exchanges. Bakkt, the newly formed company, is expected to use Microsoft Azure cloud solutions in order to operate a regulated global exchange for digital assets.
Bakkt allows large financial institutions to invest in cryptocurrencies, letting them buy, store, sell or spend digital assets easily. The company has partnered with Microsoft, Starbucks and BCG to boost investor interest.
How Does Bakkt Affect Cryptocurrency Prices?
The way Bakkt is designed to operate, there’s no doubt it will bring great things to the cryptocurrency market, boosting the prices of most top coins. For starters the company is federally regulated and approved by the government as a legitimate exchange platform. This removes any doubts from institutional investors, assuring them that they are trading with a properly regulated service provider.
Secondly, Bakkt offers custodian services to investors, which is meant to boost the safety of their funds – especially those looking to invest huge amount of money. The company also offers physically delivered futures contracts, where parties can purchase bitcoin upon the expiry of contract. This simply means that new money will be injected to the cryptocurrency market.
According to Bakkt, it will also offer a robust payment structure, connecting with merchants directly. Investors will also access a number of risk management and trading applications, boosting cryptocurrency usability and adoption.
Looking at all that Bakkt is looking to offer, one thing is certain – it will have positive impact on the cryptocurrency ecosystem and possibly foster the next ‘Bull Run’. From better liquidity to mainstream adoption, to stability to safety, the cryptocurrency market will have an influx of institutional investors, and any new money will be reflected in the prices of digital assets, pushing their value up.