Bakkt to Launch Institutional Bitcoin Custody Services
Bakkt, the crypt subsidiary of the Intercontinental Exchange, has announced that it will begin holding the Bitcoin assets of its institutional investors, which was one of the most sought-after services of the platform prior to its launch in September.
Upon launch, Bakkt initially only offered custody services to customers who were trading its Bitcoin futures contracts but has now received approval from the New York Department of Financial Services (NYDFS) to store all Bitcoin assets of its customers in the “Bakkt Warehouse.” Pantera Capital, Galaxy Digital, and Tagomi have already signed on as initial customers, with other major firms expected to join over the next few weeks.
Bakkt COO Adam White described custodial services as “a critical link … in the institutional adoption of bitcoin.” He added that “our relationship with Intercontinental Exchange (NYSE: ICE), a Fortune 500 company that owns and operates the market infrastructure upon which the world’s largest financial institutions already rely, enables us to uniquely address client needs in the digital asset custody space.”
Bakkt has been heralded as a landmark arrival in the crypto space due to its close links with legacy institutions, like the New York Stock Exchange, which it hoped would provide a gateway into crypto trading for institutional investors. However, the platform has endured a slow start to life. With just 623 futures contracts being traded in the first week, for a total value of just over $5 million USD, it appeared as though the platform was a massive flop.
The rollout of new services and the recent Bitcoin movement look to have stimulated an increase in activity for Bakkt. Over the weekend, the platform registered the largest single-day trading volume of its monthly Bitcoin futures contracts. The volume hit approximately $15.33 million USD on Friday, passing its previous high of $10.25 million USD on October 25. The total volume of Bakkt’s monthly Bitcoin futures now stands at $106.74 million USD since its launch on September 23.
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