Bakkt lags behind other Bitcoin Future marketplaces
Despite the hype in the second half of the year 2019 Bakkt's performance was lackluster to say the least , Compared to its competitors in the Bitcoin futures and options markets such as CME Group and Deribit, it has recorded significantly lower numbers in the past few months.
Bakkt's options market in particular has a significantly lower daily volume than Deribit, OKEx, CME and LedgerX and has lagged behind its competitors in both the US and international markets.
Is there a lack of institutional interest in Bitcoin or is it just bakkt?
Throughout January, Bakkt's option volume was despite the 50 percent increase in Bitcoin virtually nonexistent. It remained close to zero for a whole week, raising questions about the institutions' participation in the rally.
Given the high volume of Bakkt's competitors, however, it can be argued that Bakkt is simply not attractive to accredited investors and institutions in the market. Su Zhu, CEO of Three Arrows Capital, said that ICE's largest shareholder asked about Bakkt's small market share in the Bitcoin options and futures markets. ICE, the parent company of the New York Stock Exchange, also operates Bakkt.
“I had lunch with the largest ICE shareholder last week. He asked why Bakkt no longer gains market share compared to Bitmex, Deribit, etc. I said: 1) exaggerated dependency on clearing brokers 2) can't make a margin in BTC 3) can't trade around the clock 4) can't trade in vanishingly small sizes 5) 10 x more expensive.
For a good part of the year 2019 Bakkt was the hope for the crypto market. It has often been described as an important catalyst for Bitcoin's next upswing as investors predicted it would serve as an important infrastructure for institutions.
Nevertheless, Bakkt struggled to meet investors' expectations and was unable to catch up with the CME Group in terms of volume on the futures market.
Still not enough
According to Bakkt Volume Bot, which tracks both the daily and weekly volume of the Bakkt Bitcoin futures market, the company had futures contracts worth around
million US dollars processed.
In sharp contrast, CME has had around 500 million dollars a day in the past two weeks processed and Bakkt effortlessly exceeded. Given the high volume of CME and steady capital inflows in platforms like Coinbase Custody and Grayscale’s Bitcoin Investment Trust (GBTC), it would be premature to claim that there is a lack of institutional demand for Bitcoin.
Proof of text: cryptoslate