Blockchain is growing. We can all see it through the daily new innovations in the space, the new companies which bring growth and adoption to the cryptocurrency space, one of which is Bakkt. But what is Bakkt and how did it manage to get such a strong reputation over the past few months?
What is Bakkt?
Bakkt is created to allow institutions & consumers to easily buy, sell, store and spend digital assets. Formed with the purpose of bringing trust, efficiency and commerce to digital assets, Bakkt aims to develop open technology to connect existing market and merchant infrastructure to the blockchain.
In plain English, Bakkt aims to serve as the first Globally Regulated Ecosystem for Cryptocurrencies.
Microsoft and Starbucks and the Intercontinental Exchange (ICE) have already jumped on board of the train with partnerships that should, at least, give BAKKT some credibility.
Being new in the industry and having such strong names behind it, makes BAKKT one of the most “bullish” blockchain news of 2018; and since you are reading this article it’s likely you have also taken notice.
BAKKT is scheduled to be released the first weeks of November and the price of Bitcoin has already started to move upwards in news of the event.
Creating a global currency
Put simply, Bakkt plans to tackle how digital assets are bought, sold, stored, and spent, in a safe and efficient way.
Since many are not familiar with the role of ICE and BAKKT in other sectors it’s better we shed some light here.
What is Bakkt going to solve you may ask?
Bakkt’s goal is to address the methods with which cryptocurrencies and digital assets in general are bought, sold, spent or stored. And they want to improve these methods to become more efficient and less risky.
ICE wants to propel Bitcoin’s role into the first global currency with broad usage, and they are using Bakkt to get things started.
ICE believes that Bakkt will not only help with the mainstream adoption of cryptocurrencies; it will also carve the path for the first Bitcoin-ETF approved by the SEC.
The SEC has yet to aprove an ETF due to a fear of manipulation, which does not allow Bitcoin to be seen as a trustworthy currency. Bakkt will address these problems, opening up opportunities for more efficient and trustworthy prospective ETFs.
According to Bakkt, their exchange will not allow margin trading or leverage trading, which is now one the risky, if not gambling, way to increase your Bitcoin count. And for those who think margin trading is safe, remember that exchanges are still centralised entities vulnerable to cyber attacks. There are many exchanges that are best to be researched thoroughly before investing.
Instead, they will focus on creating a more trusted, stable price formation which will decrease the volatility in the crypto markets. There will be not price speculation from their side, just real trading, similar to the current big exchanges.
The CEO of Bakkt, Kelly Loefler, mentioned that in order to succeed, Bakkt will focus on creating a stable regulatory construst, a transparent price discovery as well as a high quality trading infrastructure. Achieving those three goals will make Bakkt different from all other exchanges and provide a safe and regulated platform for investors.
Bakkt’s Goals — Is the Platform Good for Bitcoin?
Understanding what is Bakkt’s long term goal may sound like a utopia to many.
Bakkt wants to achieve success in three different areas. First, they want to replace retail credit card payments with blockchain applications, making room for Bitcoin to finally become a payment option within the world economy. Second, Bakkt wants to provide similar insurances for Bitcoin as other assets like stocks and bonds currently have. Finally, the last step of success and probably the most important for all the “hodlers” is to allow large amounts of institutional money to enter the cryptocurrency markets.
This, however, is also their biggest challenge. Getting institutions to invest large amounts of capital into crypto is harder than most tend to realise.
Bitcoin, in the eyes of many, is meant to be decentralized with no central authority, no single institutional monopoly, or regulations; Even though some people like to chew on the mass adoption gum, claiming that a strong centralized entity is needed for Bitcoin’s success, others ask what is Bakkt offering to the space, other than one more “undercover” method institutions use to take full control of the Bitcoin market.
Some also compare the involvement of BAKKT with the results “paper backed currencies” had on gold and silver in the past (surprise, it’s not positive).
One of the best arguments against BAKKT comes from who has been putting out incredibly accurate and in-depth articles related to the (not so lambo) future of Bitcoin. His recent article on Medium, outlining the methods used by the elites to suppress the price of Bitcoin got more than 39.000 claps, resulting in him getting a large following on crypto’s preferred Social media network.
