Since Bakkt, the futures trading platform for physically settled Bitcoin contracts, launched late last month, there have been many eyes watching its performance. It was heralded as the potential game-changer for institutional adoption of Bitcoin, but the uptake has been painfully slow.
In its opening day, the platform traded 71 BTC in a performance that was seen as quite weak, but only in relation to the hype and expectation, and in comparison with much better established institutional Bitcoin futures offerings, such as those from CME.
The talk has been, from the likes of Tom Lee and even John McAfee, that the uptake of this potentially revolutionary offering will be slow and gradual. However, a few weeks into the trading and the number of contracts being traded have actually slowed.
Reports show that after hitting numbers of around 150 contracts a day in the first week or so of trading, Bakkt contracts have now dropped to numbers much closer to 50 contracts a day.
This drop in contracts may be for a number of reasons that can only really be speculated about; however, it is not too promising to see the numbers falling substantially rather than rising as the platform gets up and running.
One aspect to consider is the drop in price of Bitcoin itself. The price of the coin started falling on the launch of Bakkt, with many attributing this recent fall of over $2,000 to the Bitcoin futures launch from Bakkt.
Of course, it could still be very early to start driving a pattern of growth or decline for Bakkt. The notion of physically settled Bitcoin futures is still a new and novel idea for those traders that this product is intending to target. It is aimed at being the bridge between institutional investors and the crypto space, more so than what CME and CBOE, for instance, already offer.
A better time to judge would be once the first contracts have expired, and the initial batch of Bitcoin investors on the platform can determine the full experience and get to grips with the idea of receiving the outcomes in Bitcoin. This will be the first for many institutional investors targeted by Bakkt.