In a recently published blog post, Bakkt CEO Kelly Loeffler says the company expects to begin testing its Bitcoin BTC, 4.30% futures contracts in July. This “user acceptance testing” phase will be aimed at both Bakkt’s futures contracts and custody services.
Loeffler says the company intends to list two products for trading: a daily Bitcoin futures contract and a monthly Bitcoin futures contract. Bakkt is developing these contracts in collaboration with the ICE Futures US exchange and the ICE Clear US clearinghouse.
She continues by explaining that Bakkt aims to combat potential market manipulation and base the price of their contracts without relying on unregulated cryptocurrency exchanges:
“Price formation in these benchmark contracts will be supported by proven tools to detect abusive or disruptive trading practices, including wash trades. That means that the settlement prices on ICE Futures U.S. will be based on prices discovered in our physical delivery contracts without relying on unregulated cash markets.”
As we covered previously, Bakkt also aims to gain approval with the New York State Department of Financial Services (NYDFS) to become a qualified custodian for digital assets. If approved, this will bolster the company’s case with the CFTC, the regulatory agency that will ultimately have the final say on whether Bakkt is allowed to list its Bitcoin futures for trading.
Demand for BTC futures skyrockets as CME smashes daily volume record
Meanwhile, demand for Bitcoin futures has skyrocketed due to Bitcoin’s recent rally. Bitcoin futures trading on the CME saw record trading volumes with around 33,700 contracts (notional value over $1 billion) changing hands in a single day of trading. The previous CME Bitcoin futures volume record was established on April 4 with 22,500 contracts (around $550 million notional value).