Bakkt Exchange Wants New York License For Crypto Custody
Intercontinental Exchange, the owner of the NYSE, is reportedly hell-bent at obtaining a New York license. The latter, in particular, is meant for its long-delayed cryptocurrency exchange called Bakkt.
Attempt to Custody Bitcoin
It is worth noting that the launching of Bakkt has been helping for about five months already. That is why the ICE is trying to persuade the CFTC or Commodity Futures Trading Commission to give its approval in an attempt to custody Bitcoin. The custody for the world’s leading cryptocurrency is specifically designed for its physically-delivered futures contracts.
Interestingly, For ICE, the approval to obtain a license from the New York Department of Financial Services or NYDFS is a plausible solution. If there is a physically-settled contract that exists, it only means that buyers would finally acquire the actual commodity at maturity. In the case of Bakkt, it is none other than BTC.
However, the road to acquiring the aforementioned license will not be that easy, especially since the CFTC has its own concerns. Basically, the department is heavily concerned at the idea of having an issue when it comes to the protection of Bitcoin owned by clients, particularly those that are directly connected to the futures product.
With that said, it is possible that a state license could support Bakkt when it comes to cutting through its own reservations. It is even possible for the digital currency exchange to implement the movement of enabling retail transactions using the world’s leading crypto for companies like Starbucks, which is actually one of its investors. This one right here could really be a factor, according to the official report.
Obtaining Approval From CFTC
If ICE is successful in pulling off the near-impossible New York registration, there is a possibility that the CFTC will approve it for issuing futures through self-certification. What is more, this registration can easily sidestep the all requirements of a regulator that client funds are deposited either at a trust company or a banking institution.
Despite having permission to custody digital currencies in the state of New York, Bakkt will have to acquire the green light directly from CFTC. This would relate to the firm’s much wider operations.
Bakkt was supposed to be launched back in mid-December, but the deadline was pushed to January 24. Come New Year’s Eve, the highly anticipated launching was delayed with no certain timeline.