Intercontinental Exchange Inc (NYSE:ICE) recently announced plans to launch a new platform called Bakkt for Bitcoin Futures trading but the launch might not happen anytime soon due to regulatory issues.
ICE has been preparing to launch the Bitcoin futures platform subject to regulatory approval but the Commodity Futures Trading Commission (CFTC) is still not ready. Recent reports indicate that the regulatory authority has expressed concerns over the collateral and custodial services on the Bakkt platform.
This is not the first time that ICE has run into delays in the platform launch. The platform’s launch was originally supposed to take place in November last year because the company also wanted to be the custodian for the clients’ Bitcoin. The newly announced delay is because the CFTC wants ICE to publicize Bakkt’s business plan.
“There remains a great deal of skepticism among some regulators. It’s still very much crypto winter,” stated FS Vector partner, John Collins.
A spokesman from the company revealed that the company is working on the approval process although no further details were provided. ICE had originally planned for a physical delivery system that would facilitate Bitcoin storage to avoid crypto theft which is one of the main problems affecting the digital currency market. ICE would, under the physical delivery system be required to publicly publish its business plan and would even be subjected to a public comment duration.
The CFTC is concerned that this system would give rise to other issues especially due to the use of cryptocurrencies as collateral. The regulatory body has turned down numerous applications for Bitcoin futures. However, companies that have tried have fallen short of the CFTC’s regulatory requirements. The regulator claims that it has been strict on the regulatory requirements because it is determined to pluck out market manipulation and fraud in the market.
The regulator maintains that it is determined to make sure that investors are protected and that the market is fair. Meanwhile, ICE is determined to launch its Bakkt platform and is ready to work with CFTC towards achieving its goal through proper regulation.