Bakkt to launch cash-settled bitcoin futures next month

Quick Take

Bakkt has officially announced its plans to launch cash-settled bitcoin futures next month
The new product will be listed by ICE Futures Singapore
Lucas Schmeddes, president and COO of ICE Futures and Clear Singapore, said that it will “offer investors in Asia and around the world a convenient, capital efficient way to gain or hedge exposure in bitcoin markets”

Bakkt, a provider of physically-settled bitcoin futures contracts, has officially announced the launch of cash-settled bitcoin futures.

Bakkt will offer the new product via Intercontinental Exchange (ICE)’s Singapore unit and plans to list it on Dec. 9, according to an announcement Thursday.

The unit, ICE Futures Singapore, will list Bakkt Bitcoin (USD) Cash Settled Monthly Futures contract, while ICE Clear Singapore will clear it, both regulated by the Monetary Authority of Singapore.

“Our new cash settled futures contract will offer investors in Asia and around the world a convenient, capital efficient way to gain or hedge exposure in bitcoin markets,” said Lucas Schmeddes, president and COO of ICE Futures and Clear Singapore, adding:

“Building off the success of our deliverable futures contract, the cash settled futures will leverage ICE’s regulated, globally-accessible market to offer a safe, secure and compliant environment for the trading of bitcoin.” ICE is the parent company of the New York Stock Exchange.

Bakkt’s plan to offer cash-settled bitcoin futures was first revealed last week by its chief operating officer Adam White at a conference in New York.

Currently, derivatives exchange giant CME Group is the only provider of cash-settled bitcoin futures contracts. Bakkt is not only looking to beat rival CME on the cash-settled product, but also bitcoin options contracts. CME has been preparing to launch an options product tied to its bitcoin futures on Jan. 13, while Bakkt is planning to launch its options contracts on Dec. 9.

Bakkt's physically-settled bitcoin futures were launched in September and have been picking up on volumes lately. Earlier this month, it logged the largest single-day trading volume of~$15.33 million, passing its previous high of ~$10.25 million on Oct. 25.

Bakkt also recently announced the launch of its institutional custody business, as well as its plans to launch a cryptocurrency consumer app and merchant portal in the first half of 2020 with Starbucks.