Just last month, Bakkt finally launched. The crypto trading platform Fueled by the backing of the Intercontinental Exchange (ICE), which also owns the NYSE, Bakkt began its journey by introducing a Bitcoin futures market.
For those not in the loop, this was hyped as the much-anticipated start of a new era for the industry. Bitcoin investment Many believed this event would trigger the next surge in cryptocurrency prices, but contrary to expectations, Bitcoin's value plummeted by about 15% soon after the futures launch.
Overemphasis has been on Bakkt's Bitcoin futures; however, this venture is only a part of their comprehensive approach to cryptocurrency infrastructure.
As this Fortune feature Last August, it was stated that, 'With the formation of Bakkt, ICE is aspiring to establish Bitcoin as a universally reliable currency with broad acceptance.' Currently, the company's website headline prominently says, 'Shaping the future of digital asset infrastructure,' illustrating its dual focus on futures contracts and cryptocurrency payment systems for both businesses and consumers. firm’s website The firm plans to introduce a digital asset payment app for consumers in about nine months.
Indeed, Monday saw the firm revealed in an extensive blog post Starbucks and Crypto: Are They the Perfect Pair?
As the year commenced, Bakkt surprised the market by securing over $100 million in funding from major players like Microsoft and Starbucks.
This fueled speculations that Starbucks was gearing up to accept Bitcoin directly in its stores, hinting at significant mainstream acceptance. However, Bakkt remained mum on this, particularly as it approached the futures launch milestone.
It appears, though, that their collaboration with Starbucks is now receiving focused attention.
Just this past Monday, Bakkt's CPO, Mike Blandina, unveiled updated company plans with a key reveal catching crypto investors' attention: they are 'currently dedicated to advancing the consumer app and merchant gateway, with early testing involving none other than Starbucks, slated for this year's first half.'
While the project could significantly boost public awareness of cryptocurrencies, specific details are minimal.
Despite clear intentions to roll out a consumer payment app, the potential integration of Bitcoin in this framework is ambiguous, considering the beta phase of the Lightning Network and existing transactional restrictions with Bitcoin itself.
Despite this, a trade publication noted earlier this year that Starbucks will handle Bitcoin transactions by converting them to fiat immediately, thus avoiding cryptocurrency exposure on their balance sheets. The Block Regardless, Bakkt's CEO, Kelly Loeffler, emphasized that Bakkt aims to serve as a 'scalable entry point for institutional, merchant, and consumer engagement with digital assets by enhancing efficiency, security, and functionality.' And despite a sluggish start with their futures, Bakkt's commitment to this mission remains firm.
Galaxy Digital's Mike Novogratz responded positively, expressing that Starbucks embracing crypto would signify a significant stride towards mainstream integration.
Not Needed?
In contrast, Bloomberg’s Joe Weisenthal expressed doubt. He argued against the necessity of Bakkt's planned payment app, noting that with ample payment options available to easily purchase coffee today, the added value of a crypto-centric system remains unclear.
I concur. It's quite manageable to purchase coffee these days with existing payment avenues, leaving me puzzled about the additional benefits a crypto-based payment method could provide.
In a more opinionated reflection, while Weisenthal's view may hold in Western contexts, in regions plagued by severe inflation or financial restrictions, digital currency solutions can offer essential financial alternatives. https://t.co/hEnc4NfqdK
— Joe Weisenthal (@TheStalwart) October 28, 2019
Right now, though, Bakkt seems centered on the U.S. market, at least initially.
I pen down my thoughts on cryptocurrencies since 2013. My analyses and discussions appear in notable publications such as LongHash, NewsBTC, and Decrypt. Besides writing, I collaborate with the EXODUS unit of HTC in Taiwan. And yes, I hold some Bitcoin. Reach me at [email protected].
