Cryptocurrency

Intercontinental Exchange Will Launch Bakkt Later in 2019

Intercontinental Exchange Will Launch Bakkt Later in 2019

Jeff Sprecher, the CEO of Intercontinental Exchange (ICE) announced that they would launch Bakkt later 2019.

What is the Intercontinental exchange and Bakkt?

Intercontinental Exchange (ICE) is a Fortune 500 company formed in the year 2000 to modernise markets. ICE serves customers by operating the exchanges, trade and manage risk across global financial and commodity markets. ICE is the parent company of the New York Stock Exchange (NYSE). NYSE has helped companies raise more capital than any other exchange in the world, driving economic growth and transforming markets.

The company has now created Bakkt. A platform designed to enable consumers and institutions to buy, sell, store and spend digital assets seamlessly. They formed it with the purpose of bringing trust, efficiency and commerce to digital assets. It seeks to develop open technology to connect the existing market and merchant infrastructure to the blockchain.

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A while back, they revealed its first product. It is going to be a physically delivered Bitcoin futures contract traded versus fiat currencies, namely USD, GBP, and EUR. These futures are different from earlier contracts since fiat money back every bought bitcoin. A few weeks ago, they announced that they finished their first funding round. They raised $182,5 million from 12 partners and investors. The company also announced that they look for new developers and directors to lead the project forward.

Bakkt to launch during 2019

During a recent earnings call with Sprecher commented on the future of Bakkt. Even though the call’s focus was regarding ICE’s financial results, Sprecher managed to say share the plans for the company. He explained that the company spent over $1 billion on strategic initiatives, including on the launch of the digital asset platform.

Scott Hill, The company’s CFO, further revealed his expectations regarding the digital platform’s expenses. He estimated Bakkt’s current financial position.

“And finally, our investment in Bakkt will generate $20 million to $25 million of expense based upon the run rate in the first quarter. We will update you on progress and the level of investment as we move through the year.”

When asked about the expected returns or revenue growth from recent investments, including Bakkt, Sprecher characterised the crypto platform as a long-shot for ICE:

“So it’s a bit of a moonshot bet and it’s been organised in a manner that is very different than the way ICE typically does businesses […] They’re well along in building out an infrastructure that I think you’ll see launch later this year.”

Bakkt is a stand-alone project from ICE and has its management team, infrastructure and its own offices. Hill argued that Bakkt is a project for the long-term rather than the short-term. He said:

“I think Bakkt is an investment […] That’s more about the future and revenue and market opportunities that we see in the future and less about 2019 topline.”

However, they still plan to launch the platform during 2019, and it seems as though they are working hard to make Bakkt a reality.

Image Source: “Flickr”

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