Yesterday, amid growing negative sentiment around the Cryptocurrency market, the much anticipated Bakkt Futures platform delayed its launch until next year. Before you take this news and consider something extreme like giving up hope in the future of Crypto, it is important to put not only this, but the overall market conditions into perspective.
Firstly, Crypto is far from dead.
It is experiencing a large downturn, but this downturn is due to various conditions that are quite natural for a new space, including fear mongering from those who do not want to see it succeed. Furthermore, in Bakkt’s case, their CEO, Kelly Loeffler, made clear that their delay was not so much due to market conditions, but to their desire to have a smooth, well-prepared launch.
Included in this sentiment are the ideas that the company has not gotten to its ideal position with regards to pre-launch partners and clear regulatory approval. In addition to this, Bakkt has also specified that the Commodity Futures Trading Commission is still reviewing their minimum viable product to determine if it can be regulated.
Due to these statements, it is easy to conclude that Bakkt’s delay is a good thing. They are just trying to do their due diligence, right?
The truth is, even with this possibility, another form of motivation exists.
Bakkt’s future platform will mainly be led by its Bitcoin Daily Futures service, which is dependent on the price of Bitcoin staying at certain levels for it to succeed. In other words, regardless of how altruistic a futures trading platform makes their offering seem, they still want to make money. If Bitcoin continues to fall considerably for the rest of the year, then it is likely that most customers will place their bets in this direction.
Therefore, the only significant way for the company to make a considerable profit would be for Bitcoin to rise. Because of this, one should also accept the chance that Bakkt simply wants the market to stabilize in a direction that is favourable for its needs before it goes live.
In the end, these needs could even just mean that the company does not believe any party will make any money in such a bear market. Thus, the answer to the delay could be as simple as Bakkt betting on when the bear market will end.
Furthermore, due to the inherent volatility of the Crypto market, only the launch will help us to understand any of this. Even so, we hope that this short analysis will help you on your way to making informed decisions on this subject.
By: BGN Editorial Staff