NYSE Owner Putting Muscle Behind Bitcoin -- WSJ
August 04 2018 - 3:02AM
Dow Jones News
By Inyoung Hwang
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (August 4, 2018).
The owner of the New York Stock Exchange said it is launching a
new bitcoin company and futures contracts based on the digital
currency.
Intercontinental Exchange Inc., or ICE, plans to create a new
company called Bakkt (pronounced "backed"), which will offer a
platform that allows customers to buy, sell, store and spend
digital currencies, according to a statement Friday.
The exchange also said it would launch one-day, physically
delivered bitcoin futures in November, pending regulatory approval
from the U.S. Commodity Futures Trading Commission. ICE is one of
the world's biggest exchange operators and a dominant player in the
futures market -- home to the Brent oil futures contract.
Following an extraordinary run-up in bitcoin prices last year,
CME Group Inc., the world's largest exchange company, and Cboe
Global Markets Inc., operator of the biggest U.S. options exchange,
both launched futures on the cryptocurrency in December. The moves
were seen as a big step forward for the once-fringe asset gaining
wider acceptance on Wall Street.
ICE's futures will differ from the contracts by CME and Cboe in
that they will be physically delivered, meaning holders can get
actual bitcoin, and not cash, upon settlement.
Bakkt, which plans to announce more details in coming weeks, is
working with BCG, Microsoft Corp. and Starbucks Corp. to create its
platform. Maria Smith, vice president of partnerships and payments
for Starbucks, said in the statement that the coffee company will
play a pivotal role in developing trusted and regulated ways for
consumers to convert digital assets into U.S. dollars for use at
Starbucks.
"Starbucks is committed to innovation for expanding payment
options for our customers," Ms. Smith said.
Even after intense interest world-wide last year, bitcoin hasn't
gained traction as a form of payment.
ICE has taken a more wait-and-see approach to cryptocurrencies
even as its rivals have rushed to launch bitcoin futures. In
December, Chief Executive Jeffrey Sprecher expressed doubts about
the wisdom of being the first U.S. exchange to offer bitcoin
futures, citing issues like the few sellers in the market at the
time and the lack of transparency in digital-currency
exchanges.
ICE has been involved in cryptocurrencies through its investment
in Coinbase, a San Francisco-based provider of "wallet" services
that is one of the leading cryptocurrency businesses. In January,
ICE also announced it was teaming up with startup Blockstream to
start a service that would bring bitcoin data to hedge funds and
other professional trading firms.
Bakkt will be led by Kelly Loeffler, who was until recently
ICE's longtime head of communications. She is married to Mr.
Sprecher. The Atlanta-based company announced her departure in late
March.
Write to Inyoung Hwang at inyoung.hwang1@wsj.com
(END) Dow Jones Newswires
August 04, 2018 02:47 ET (06:47 GMT)
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