The highly-anticipated launch of the Bitcoin futures trading platform Bakkt, owned by the Intercontinental Exchange (ICE), has begun user acceptance testing of its daily and monthly Bitcoin futures contracts. Contrary to what many expected, however, the BTC price reacted negatively, dropping by 5 percent following the announcement.
Bakkt Kicks Off User Acceptance Testing (UAT)
As CryptoPotato reported last month, Bakkt was scheduled to begin user acceptance testing yesterday. Right on schedule, the Bitcoin futures trading platform announced that it had kicked off UAT of its daily and monthly Bitcoin futures contracts.
Today kicks off user acceptance testing @ICE_Markets for the Bakkt Bitcoin Daily & Monthly Futures contracts
Testing is proceeding as planned with participants from around the world
— Bakkt (@Bakkt) July 22, 2019
Supposedly, participants from around the world are involved. The interesting thing about Bakkt’s Bitcoin futures contracts is that they are physically settled. This means that once each contract expires, instead of receiving the cash equivalent of the underlying asset, the user will receive the asset itself. In this case, that’s Bitcoin.
There are two types of contracts, differentiated by the settlement period. The first type will be settled daily, while the second one will allow users to receive exposure for a longer time frame and will be settled monthly.
It’s also worth noting that Bakkt is supposed to contribute $35 million into its clearinghouse risk waterfall. Moreover, the physical delivery and secure storage of Bitcoin will be carried out using an integrated custody service which will be subject to regulatory approval.
Bitcoin Price Plunges in Response
Interestingly enough, the highly-anticipated launch of Bakkt’s UAT didn’t trigger any positive action in Bitcoin’s price. On the contrary, the cryptocurrency is down about 5 percent in the past 24 hours.
This continues a losing streak for Bitcoin, which has lost a total of 18 percent in the past two weeks and 7.8 percent in the last week alone.
At the time of this writing, BTC is trading at around $10,130 and possesses a total market cap of around $179 billion.