ICE Bakkt project targets New York BitLicense

Posted 19 April, 2019

A long-awaited ICE's Bakkt trading platform expressed intentions to file an application for the business license with the NYDFS striving to launch operations (in particular cryptocurrency custody service) in the New York State.   

As the sources in the known said Bakkt wants to win BitLicense for crypto custody, which in fact can be a strong argument in talks with US Commodity Futures Trading Commission. The latter keeps considering the application of the platform, and thus the launch of the physically delivered bitcoin futures remained up in the air.

Some market players believe that crypto assets security can be one of the main stumbling points in negotiations with the regulator. For reference, the Bakkt rescheduled the launch of the services for a few times just due to a lack of the regulator's approval.

Earlier, the company representative said that the platform remained in talks with the regulator, and even some positive results had been achieved.

At the same time, CFTC believes that Bakkt's product (physically delivered bitcoin futures) differ from those offered by CME and CBOE. One of the difference is that its futures require a transfer of users' funds to a bank or trust companies, thought Bakkt is not such businesses.

There are also rumours that some members of ICE were somewhat reluctant regarding the realization of the Bakkt project.

Along with futures, Bakkt also intends to deal with processing bitcoin payments in the retail sales area.

It is quite possible that CFTC meets Bakkt halfway and allow Bakkt to launch service with autonomous certification in case of the positive determination by the New York State.

However, CFTC may call for comments and ask ICE to establish the commission that will deal with a risk assessment for the new product. As it was reported earlier, the Bakkt platform managed to generate $182 million during the Series A funding, with the company's investment assessment $740 million in total.

Notably, a rival of the Bakkt platform LedgerX also reportedly filed BitLicense for application with the NYDFS.

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