- Bakkt’s head sees the end of unregulated cryptocurrency exchanges.
- Bakkt trading volumes have been decreasing recently despite the market recovery.
Speaking during a closed event in Tel-Aviv, Adam White, the head of the world’s first regulated trading platform that offers Bitcoin futures with physical delivery, aired a gloomy forecast for unregulated exchanges for cryptocurrency derivative products. He said that regulators would not allow such platforms as BitMEX, Bybit, and the other leading crypto margin exchanges, run unsupervised forever.
We’re watching trading happening offshore, on unregulated venues, with very little KYC, no AML – these days are not going to last forever. Regulators are slow, but they are persistent, and they will not allow this to happen indefinitely.
Currently, Bakkt offers only Bitcoin futures contracts; however, the range of available cryptocurrency instruments may be expanded in the future, provided that there is consumer demand for such products. Answering the question about new cryptocurrency contracts, White explained:
We want to be able to store anything our customers want. We’re a business and we’re here to provide that service. Now does that mean ICE is going to create a future on every crypto asset? Probably not. There’s still a lot of cryptocurrencies that it’s unclear if they securities, Are they currencies or commodities. The CFTC has only said they’d theoretically have approved futures on mainstream crypto assets, Bitcoin and Ethereum. Other than that, it’s still unknown. It’s under us.
He also added that currently, Bakkt is the only fully regulated Bitcoin market.
Bakkt trading volumes slump
Notably, the trading activity on Bakkt is waning despite Bitcoin’s price increase and massive volume spikes since the beginning of the year. Thus, according to skew (@skewdotcom), no Bitcoin options contracts have been traded on the platform in recent ten days, which is an ominous signal for the market. Monthly futures still maintain a good volume, but it is also decreasing.
According to the latest statistics provided by Bakkt Volume Bot (@BakktBot) 1204 contracts worth of $11.57 million were traded on the platform on Tuesday, which is 44% lower from the previous day. Meanwhile, open interest increased by 43% to $8.83 million.