The Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, officially launched its Bakkt Bitcoin futures platform on September 22, 2019, marking a watershed moment for institutional cryptocurrency adoption. Trading commenced at 8:00 p.m. EST, introducing the first physically delivered bitcoin futures contracts to the market.
TL;DR
- Bakkt launched physically settled bitcoin futures on September 22, 2019, at 8 p.m. EST
- 57 monthly contracts were sold in the first day, with 29 changing hands in the first 12 hours
- Unlike CME and Cboe futures, Bakkt settles in actual bitcoin, not cash
- The platform also offers daily futures with next-day settlement
- Bitcoin price dipped below $10,000 as Bakkt trading began
A Different Kind of Bitcoin Future
What sets Bakkt apart from the bitcoin futures products that preceded it is the settlement mechanism. While the CME Group and the now-suspended Cboe bitcoin futures settle in cash, Bakkt contracts settle in actual bitcoin. Each contract represents one full bitcoin, meaning that upon expiration, the buyer receives physical delivery of BTC held in the Bakkt Warehouse.
This distinction matters enormously for the cryptocurrency market. Cash-settled futures allow traders to speculate on bitcoin price movements without ever touching the underlying asset. Physically settled futures, on the other hand, create direct demand for bitcoin itself. For an industry that has long sought institutional legitimacy, Bakkt represents a bridge between traditional finance and the crypto ecosystem.
The Bakkt Warehouse, which provides the custody infrastructure for these physically settled contracts, launched on September 9, 2019, after the platform had already undergone a closed beta testing phase that began in July 2019. The warehouse is designed to meet institutional-grade security standards, addressing one of the key regulatory hurdles that had delayed the launch for months.
Humble Beginnings, Big Ambitions
The initial trading volumes were modest. In the first 12 hours, only 29 monthly futures contracts changed hands. By comparison, when the CME launched its cash-settled bitcoin futures in December 2017, the exchange processed over 1,000 contracts on day one. However, market analysts noted that Bakkt’s physically settled model naturally attracts a different type of trader, one more interested in actual bitcoin exposure than pure speculation.
The platform offers two products: monthly futures, which settle at the end of each month, and daily futures, which settle the very next day. Daily settlement options are relatively rare in commodity markets, though ICE already offers similar products for gold and silver futures.
The Starbucks Connection and Beyond
Bakkt’s ambitions extend well beyond futures trading. The platform was announced in August 2018 with considerable fanfare, partly because of its partnership with Starbucks. The coffee giant is reportedly a significant shareholder in Bakkt and is developing a payment card that would allow consumers to use bitcoin for in-store purchases. While the consumer-facing features are still on the roadmap, the vision is clear: Bakkt aims to become an all-in-one platform for trading, custody, and eventually retail payments.
The broader context is significant. Bitcoin was trading around $10,070 on September 22, well below its all-time high near $20,000. The launch of a regulated, physically settled futures product by the owner of the New York Stock Exchange represented a vote of confidence from the highest levels of traditional finance.
Why This Matters
Bakkt’s launch was a pivotal moment for cryptocurrency market infrastructure. By offering the first physically delivered bitcoin futures on a major regulated exchange, ICE created a pathway for institutional investors to gain direct bitcoin exposure through familiar trading mechanisms. The modest initial volumes belied the long-term significance: Bakkt would go on to become a key player in crypto derivatives, eventually launching a retail app and a bitcoin rewards program. The September 22, 2019 launch date marks the moment when Wall Street truly began building bridges into the world of digital assets, not through cash-settled proxies, but through contracts that demanded actual bitcoin delivery.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results. Always do your own research before making investment decisions.
57 monthly contracts on launch day and people were calling it historic. The bar for historic in crypto is remarkably low.
57 contracts was genuinely embarrassing for an ICE backed product. but physically settled was the right call long term, cash settled is just gambling on price
57 contracts was the market saying cash settled is good enough. Bakkt solved a problem institutional traders didnt have
Wei Chen 57 contracts was embarrassing but bakkt did prove something important: ICE and NYSE backing couldnt generate real demand for physically settled BTC in 2019. the market just wasnt ready
Anja D. historic was a stretch for 57 contracts but it was the first time a major US exchange touched actual BTC settlement. embarrassing volume but real institutional infrastructure
physically delivered sounds cool until you realize most institutional traders dont want custody headaches. CME had this figured out from day one
physically settled matters for actual price discovery though. cash settled futures just create paper BTC that never touches the chain
bagel_runner physical delivery matters for price discovery but in 2019 nobody wanted actual BTC custody. ICE underestimated how few institutions were ready for self custody logistics
delivery_or_cash physical delivery sounds great until you deal with actual custody logistics. most institutions dont want to handle raw BTC, they want cash settled exposure with zero operational overhead
Bitcoin dipping below $10K the moment Bakkt opened trading was not the debut ICE was hoping for.
btc dumping below 10K on bakkt launch day was the most bitcoin thing ever. the market has a sick sense of humor
the fact that btc dumped on bakkt launch and then rallied 300% over the next year tells you everything about markets pricing in institutional adoption
57 contracts vs CME doing billions in volume. Bakkt proved physical settlement works but CME proved nobody actually wants it