Bakkt, a highly-anticipated Bitcoin futures trading platform, has faced numerous delays over the past several months. Now, details about those delays have come to light. Bloomberg, citing inside sources, has reported that Bakkt is struggling to gain regulatory approval for its custody service and its clearinghouse.
Why Custody Matters
Bakkt plans to offer Bitcoin futures, which are investment contracts that oblige an investor to buy or sell assets at a certain date or price. Other exchanges already sell Bitcoin futures, but they usually settle contracts in cash. Bakkt, meanwhile, will pay out futures contracts with Bitcoin. Naturally, Bakkt must hold actual Bitcoin (BTC) to do this.
In technical terms, this means that Bakkt must act as a custody service. However, Bloomberg’s sources say that Bakkt’s custody service does not meet regulatory requirements. The Commodity Futures Trading Commission (CFTC) requires clearinghouses to deposit customer assets at a bank or trust company, and Bakkt does not meet that criterion.