Bakkt

[fillippone]

Not bad, could have been better. We have patience, with those sideline market it couldn't be so much different.

Does anyone know what their fee structure is and how much money they'd be making from a 100 BTC volume day? I'd love to know what projections they sold the idea to investors with.

I will investigate this, and I have a feeling how to do that.
But my gut feeling is that they need at least a couple of orders of magnitude of increase to turn this product profitable.

EDIT:
I found something.
Fees are pretty expensive considering a contract is now worth around 10,000 USD.
https://www.bakkt.com/publicdocs/Bakkt_faq.pdf

Fee  Category	Bakkt Bitcoin Daily Futures	Bakkt Bitcoin Monthly Futures
Exchange and Clearing Fee - Screen Trades	$1.00/contract	$1.25/contract
Delivery Fee	$9.75/contract	$9.75/contract

CME OIL Future has similar absolute fee levels (actually delivery fees are way lower) but notional is around 50 USD* 1,000 barrels = 50,000 USD.
 

[fillippone]

Another thing to think about when speaking of Bakkt is that actually not all the institutional money willing to trade BAKKT is able to do so.
To buy Bakkt smaller institutions, that are not exchange members (all smaller institutions, basically) must go trough a clearer.
A clearer is someone rolling your positions from your trading account to the exchange trough their own accounts, and eventually taking care of delivery procedures.
Well, while clearing a cash future is quite trivial, clearing a physical Bitcoin is totally another story.
When CME/CBOT launched a lot of clearer were late in allowing their own clients clear the cash settled bitcoin, even if it was virtually indistinguishable from any other future from clearer’s perspective (being only a sum of cash flows).
As far as I know the story is repeating this time, only in a bigger scale, as available clearer are even less prone to allow clients trade for the moment, I think mainly for technical reasons handling clients bitcoin with good enough security and accountability.

This is another reason why is important to keep an eye on the volumes:  best way I found to do so is following @bakktbot on Twitter

[fillippone]

A few updates from Bakkt world.
I think all of them are positive news, so I am collecting here for further discussion and though feeding:

• 1. Bakkt announced options trading live from Dec 9th.
  Bakkt bitcoin options on futures to launch December 9: an industry first
  
  

  On December 9, Bakkt will launch the first regulated options contract for bitcoin futures. We’re committed to bringing trust and utility to digital assets and the options contract is an example of the many products we’re developing for regulated markets. The Bakkt Bitcoin Options contract will be based on the benchmark Bakkt Monthly Bitcoin Futures contract and represents another important step in developing this asset class for institutional investors, their customers and investors.
  

  
  More information, contract specifications etc can be found here.
  
  
• 2.Bakkt announced an integrated platfom to leverage their wharehouse in a ecosystem providing state-of-the-art security and integration. Basically a phase 2 of their product offering.
  Unlocking the value of digital assets
  
  

  Billions of dollars in digital assets exist today across the world, such as bitcoin, cashback and rewards, in addition to other forms of digital value relied upon by consumers and merchants. A key feature of the model we’ve designed is to support a superset of digital assets, including cryptocurrencies, as seamlessly as investors transact in stocks in a retail brokerage account. Our vision is to provide a consumer platform for managing a digital asset portfolio, whether they wish to store, transact, trade or transfer their assets.
  

• 3. Bakkt future volumes are defintely on the rise:
  
  
  [Source]
  Volumes picked up, topping 1,187 BTC traded in a single ssession with a robust positive momentum in tading activity.
  Volumes are slowly trickling down also on back months (longer futures expiries)
  They finally solved their launch rollout phase: now they have 6 FCM (Full Clearing Members- institutions fully abilitated to directly access their wharehouse), 2 of those being retail brokers. The lack of clearers has been a drag in other futureS product launch (CBOT/CME had serious issues getting their future cleared by clients) , and now the bottleneck has been removed.
  A decent underlying price volatility has also helped driving futures' trading volumes up.
  

[barbara44]

The release of bakkt may have been bearish at the onset, but I still believe that as the platform grows, there will surely be an improvement of this bakkt on the market and I was quite surprised also to have seen how much they have grown now, because I could remember that when that bear struck the market, they were trading at 7 btc, but now to have over a thousand within that short time to now.

I think that it is really a great news that their product is getting response from people and this might all be some of the things that contributed to the increase or the surge in price of bitcoin that we witnessed of recent, even though we are all trying to attach it to china president news on blockchain, but I still think that bakkt has something to do with it also.

[fillippone]

We have a first glimpse of Bakkt Open Interest via Bloomberg Terminal, a professional service not available to general public, but we might find this information also for free in the next weeks.



More informations here.

[fillippone]

Little update.

With more clearers onboarded, BAKKT has finally developed a few volumes.
With recent price volatility not only volumes raised, but also Open Interest is at historical maximum: this means trading volumes weren't scalping, but real positioning by players.





Of course putting this in perspective, when CME cash settled future trades 10,000 Lots (each one of them controlling 5 bitcoins, so 50,000 Bitcoins equivalent) tells a different story, but we have to reckon things are beginning to spin for Bakkt.



We see volumes and open interest are way higher then on Bakkt, but OI is low compared to other seasons.

[infofront]

[Wexlike]

*skip*
Of course putting this in perspective, when CME cash settled future trades 10,000 Lots (each one of them controlling 5 bitcoins, so 50,000 Bitcoins equivalent) tells a different story, but we have to reckon things are beginning to spin for Bakkt.

*skip*

50k traded BTC daily ?? That's a shitton of volume!

[fillippone]

New Volumer record on Bakkt:

Daily summary of Wednesday's Bakkt Bitcoin Monthly Futures:

📈 Traded contracts: 5671 ($42.52 million, +148%)  (New ATH 🚀)
🚀 All time high: 5671 (11/27/2019)
💰 Open interest: $4.16 million (+6%)

Follow
@BakktBot
 for updates - Sats welcome @ https://tippin.me/@BakktBot

https://twitter.com/BakktBot/status/1199951594701434880?s=20

5,000 traded contract starts to be comparable with volumes observed on CME, trading 5,000-10,000 contracts daily (each one of them controlling 5 bitcoin).

The most important thing is the dynamics on those volume records: they are getting positive traction!

[gentlemand]

50k traded BTC daily ?? That's a shitton of volume!

But it's meaningless. And it's doubtful it's taking away 'real' volume as very few of those traders would want to go anywhere near the real market. It'll be interesting to see what Bakkt's cash settled stuff gets up to. Perhaps the Bitcoin settled bit was just a way to get some major publicity before launching that.

[fillippone]

50k traded BTC daily ?? That's a shitton of volume!

But it's meaningless. And it's doubtful it's taking away 'real' volume as very few of those traders would want to go anywhere near the real market. It'll be interesting to see what Bakkt's cash settled stuff gets up to. Perhaps the Bitcoin settled bit was just a way to get some major publicity before launching that.

I would say the opposite.
Bakkt cash settled futures is a way to get more people into the physical bitcoin.

I think mission plan for Bakkt is to get as many player as possible involved with physical bitcoin, selling their whole custodian infrastructure as a "safety box" ffor their holdings.
Their long term target is to dethrone CME as biggest future player and get traction on the physical bitcoin trading. Their 1-day future is a key product to understand this. (being a 1-day future very similar to a spot transaction)

[gentlemand]

Bakkt cash settled futures is a way to get more people into the physical bitcoin.

I think mission plan for Bakkt is to get as many player as possible involved with physical bitcoin, selling their whole custodian infrastructure as a "safety box" ffor their holdings.
Their long term target is to dethrone CME as biggest future player and get traction on the physical bitcoin trading. Their 1-day future is a key product to understand this. (being a 1-day future very similar to a spot transaction)

It's a nice idea but most people on this very forum are only here for the dollars even if they don't say it out loud. A dollar option on Bakkt will be way more attractive to the average user.

I'm interested to see how it plays out and I'm impressed at the amount of effort they put in to have the physical option so they at least must be believers. I don't have much faith in their users. Maybe it's one of those things that'll come properly good many years down the line.

[fillippone]

Bakkt cash settled futures is a way to get more people into the physical bitcoin.

I think mission plan for Bakkt is to get as many player as possible involved with physical bitcoin, selling their whole custodian infrastructure as a "safety box" ffor their holdings.
Their long term target is to dethrone CME as biggest future player and get traction on the physical bitcoin trading. Their 1-day future is a key product to understand this. (being a 1-day future very similar to a spot transaction)

It's a nice idea but most people on this very forum are only here for the dollars even if they don't say it out loud. A dollar option on Bakkt will be way more attractive to the average user.

I'm interested to see how it plays out and I'm impressed at the amount of effort they put in to have the physical option so they at least must be believers. I don't have much faith in their users. Maybe it's one of those things that'll come properly good many years down the line.

Agreed, but we all due respect to this forum, we are not Bakkt user base.
Bakkt is targeting financial institutions: real money accounts (pension funds and  investments funds to start) and banks.
I think they are even barely intrested in dealing with OTC desks (whales).
Their long term objective, as I understood (and this is why I am so excited about their progresses) is to make Bitcoin a viable asset class for "traditional" investment.

The usual disclaimer is the following: "It's not Bitcoin that needs Wall Street, but Wall Street that needs bitcoin".

[El duderino_]

To many people are in BTC only for the dollar just as gentlemand telling .... and for those people BAKKT is an enormous HOPIUM injection to get rich fast whiteout knowing d*ck, also just as gentlemand says most like very much most people on the forum are in BTC for dollars but not gonna speak out loud of-course, at the other side I do understand that a lot of people see the opportunity to make a quick buck only they will be exposed to something they don’t know and they will only read the good stories like BAKKT = MOON overnight though they must read some post like how gentlemand and more explains things like BAKKT etc
Sometimes I think when somebody owns not to much IRL it’s difficult to get into BTC and have faith and etc though that’s a flawed statement, people just need to take the time and effort to try and learn about it.... Like all things in live, understanding requires effort of learning reading rinse and repeat

[El duderino_]

∙ Today's volume so far: 4269 BTC ($32.26 million)
∙ Last traded price: $7,558
∙ Trading day progress: 50%
∙ Current daily Bakktarget™: 5569 BTC ($42.08 million)

https://twitter.com/bakktbot/status/1199768490183405569?s=21

 

[fillippone]

∙ Today's volume so far: 4269 BTC ($32.26 million)
∙ Last traded price: $7,558
∙ Trading day progress: 50%
∙ Current daily Bakktarget™: 5569 BTC ($42.08 million)

https://twitter.com/bakktbot/status/1199768490183405569?s=21

 

Yeah, that tweet refers to the same day (yesterday) when they later actually set the record.

[El duderino_]

Sorry ^ hadn’t read through the thread for the most 

[LUCKMCFLY]

Futures Activity..

#Bakkt #Bitcoin Futures Activity Report

Record amount of Bakkt contracts traded yesterday. After the launch a couple of months ago it looks like the trading activity is really catching up.

Keep an eye on it with the daily updated Bakkt #BTC activity report 👇

Source: https://twitter.com/ecoinometrics/status/1200060696219639808

[gentlemand]

So what is the consensus on their launch of options? For some the idea of shorting with limited downside is going to attract a lot more unpleasantness. The one time I tried options in the stock market I forgot about it and came back to find a huge profit so I think it's lovely.

[fillippone]

So what is the consensus on their launch of options? For some the idea of shorting with limited downside is going to attract a lot more unpleasantness. The one time I tried options in the stock market I forgot about it and came back to find a huge profit so I think it's lovely.

I am not conspiracy theorist about financial instruments in the markets.
I think every instrument adding liquidity to the market and facilitating the price discovery of bitcoin is more than welcome.
I have started writing a thread to be published on options and how to use them, as they are a greatly misunderstood instruments and there are a lot of misconceptions about them.

So I don’t know what is the consensus is about options:
If I were a whale I would be an happy seller to deep out of the money calls, to gain from cashed in premium while having a way to cash in price spikes.
If I were a bank I would be a buyer of calls to leverage my investment in crypto and gain exposure on the (inevitable ) bull run.
If I were a nocoiner I would buy slightly in the money calls to have complete upside exposure while saving some dollars.
If I were stupid I would but puts.

So there are many use case, I have an idea of what it will be the most used strategy, but it will really depends on the kind of users will engage with options on Bakkt (again, on Bakkt, they will be professional, not single users)