Bakkt Goes on a Spending Spree Before Launch

Bakkt, the upcoming and long-awaited Bitcoin futures trading platform and digital asset custodial solution, has recently announced its first acquisition deal. According to the post on Bakkt’s Twitter account, the exchange signed the agreement for the acquisition of ‘certain assets’ of the Rosenthal Collins Group (RCG), a respected futures commission merchant.

We're pleased to share that we have entered into an agreement to acquire certain assets of Rosenthal Collins Group (RCG), an independent futures commission merchant https://t.co/5sgdbRO6Ql

— Bakkt (@Bakkt) January 14, 2019

In December, the RCG announced the sale of all its customer accounts to Marex Spectron, one of the biggest commodity brokers — and Bakkt was quick to react. The exchange jumped at the opportunity to profit from the best practices and expertise of the regulated entity which has been a stalwart in the market for nearly 100 years. Bakkt took its chance and bought some of the valuable assets related to the further development of its upcoming crypto platform. The terms and conditions of the deal are not disclosed, though Bakkt said it expected to finish negotiations by the following month.

Ambitious Plans

Bakkt is widely known as a promising project but has seen multiple delays holding back its release. Created and backed by the Intercontinental Exchange (ICE), the platform aims to launch first physically settled Bitcoin futures within ICE’s regulated and long-established market infrastructure. Bakkt hopes to build the first secure marketplace for physical delivery of digital assets that would open the doors between traditional and crypto markets. This should, in turn, lend more credibility to digital assets and attract more institutional investors, merchants, and individuals. Such an innovative and efficient ecosystem that also meets regulatory requirements should help digital assets to enter the mainstream and gain mass adoption. The latest deal with RCG represents another significant move of the platform following a successful round of financing that brought it over $182 million in investments at the end of December. The exchange believes that the acquisition of assets of the registered futures commission merchant should bolster its push to traditional financial markets. Besides, RCG’s expert team might also help Bakkt improve its risk management, compliance, customer service, and Anti-money laundering (AML)/ Know Your Customer (KYC) procedures.

When Next Bakkt Delay?

In its announcement, Bakkt makes it clear that it is determined to launch its crypto platform despite the long wait for regulatory approval by the US Commodity Futures Trading Commission (CFTC). The company stresses that it is not standing idle but keeps on working on the project development and invests heavily in technology to introduce the trusted platform. Unfortunately, in the case with Bakkt, trust is a sticking point because of repeated delays. Initially, the platform’s launch was scheduled for Nov 2018, but soon it was postponed, at first until December and then again till January. What is more, the launch date may be pushed back even further because of the ongoing U.S. government shutdown. Currently, the launch is vaguely set for ‘early 2019.’ As a result, many in the crypto community now poke fun at the project for its sluggishness. However, others claim that regulators are to blame, not Bakkt. Meanwhile, Bakkt waits ready to launch and always working to improve their platform. Do you think the Rosenthal Collins Group is a good investment for Bakkt? Do you believe the company will ever manage to bring its platform online?