BITCOIN, BLOCKCHAIN

Former IBM, Cisco Executive Joins Bakkt’s Board of Directors

Bakkt CEO, Kelly Loeffler, has announced Tom Noonan, former executive at both IBM and Cisco, will be joining Bakkt’s board of directors.

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Kelly Loeffler
Kelly Loeffler

“We are charting a new course and it requires significant work,” said Loeffler.

“Chairing the board is Tom Noonan, a cyber expert and founder of numerous cybersecurity companies, including Internet Security Systems (IBM), JouleX (Cisco) and Endgame.”

Also joining Loeffler on the board are Jeff Sprecher, the Founder, Chairman and CEO of Intercontinental Exchange (ICE) and Chairman of the New York Stock Exchange (NYSE), as well as, Akshay Naheta, Managing Partner at Softbank, and Sean Collins, Managing Partner at Goldfinch Partners.

In a recent blog post, Loeffler stated security concerns and market manipulation is the most important reason for Bakkt.

“With ongoing reports of crypto market manipulation and security concerns, the need for the solutions we’re building at Bakkt is more critical than ever,” stated Loeffler.

“It illustrates why regulated custody and market-based solutions for digital assets are at the core of our work to address risks that have discouraged many from interacting with digital assets. Security, infrastructure and regulatory clarity are cornerstones for building trust, and ultimately to help this technology serve people around the world.”

Bakkt is working closely with the Commodity Futures Trading Commission (CFTC) to acquire regulatory approval.

As for an official launch date, the time target for a physical BTC futures market is still unclear.

“While we’re not yet able to provide a launch date, we’re making solid progress in bringing the first physical delivery price discovery contracts for bitcoin to the U.S., where price formation will occur in federally regulated, transparent markets,” stated Loeffler.

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BITCOIN, BLOCKCHAIN

Invesco Launches a Blockchain ETF on the London Stock Exchange

LONDON – Investment management company Invesco launched a new blockchain-based exchange traded fund (ETF) on the London Stock Exchange today.

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The Invesco Elwood Global Blockchain UCITS ETF has been developed in partnership with Elwood Asset Management (Elwood), an investment firm specializing in providing institutional investors with exposure to digital assets and blockchain technology.

“Blockchain has been around for a decade, but many people still see it just as the technology behind cryptocurrencies,” said Bin Ren, CEO of Elwood.

“The true potential, however, may extend far beyond that. We are beginning to see the technology being used by financial services companies in particular, but we expect greater application of blockchain technology across a wide range of industries.
We believe the potential for blockchain to change the global economy is greatly underappreciated in today’s market, much like the internet was in the beginning, when most people couldn’t see past its usefulness for email.”

In terms of the largest sector allocations, the index currently has 46% in information technology, 23% in financials, 9% in communication services and 8% in both the materials and consumer discretionary sectors.

The three largest geographical allocations are to the US (39%), Japan (29%) and Taiwan (12%).

Chris Mellor, Head of EMEA ETF Equity Product Management at Invesco, said, “The potential for blockchain to drive real earnings is huge, but it is often hidden within companies involved in other areas. This ETF offers investors access to companies with real earnings now, but with the added potential of blockchain-related earnings not reflected in their share prices.”

The ETF aims to deliver the performance of the Elwood Blockchain Global Equity Index by physically investing in the index constituents.

The index offers exposure to global companies in developed and emerging markets that participate or have the potential to participate in the blockchain ecosystem. It is designed to evolve with the potential growth of blockchain technology.

Kevin Beardsley, Head of Business Development at Elwood, commented, “The majority of the index is currently allocated to companies where the value attributable specifically to blockchain technology is either in the ‘developing’ or ‘potential’ phase. These are companies with assets that are well-positioned to capitalize on the emerging opportunities for blockchain. Over time, however, we would expect the balance to shift naturally to companies with more significant direct exposure to blockchain-related earnings as the technology becomes more ubiquitous.”

The index is calculated for Elwood Asset Management by Solactive AG, a globally recognized index provider with expertise in tailor-made indices.
The index is reviewed and rebalanced quarterly.

The Invesco Elwood Global Blockchain UCITS ETF is the latest example of Invesco’s expertise in identifying new and interesting segments of the market and creating funds that enable investors to access those opportunities efficiently.

Invesco launched the first ETFs in Europe that provided targeted exposure to the financial technology and biotechnology sectors, and the firm also offers a full range of US and European sector ETFs.

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BITCOIN, BLOCKCHAIN

Reality Shares Bitcoin ETF Withdrawn After SEC Request

TAP PLAY TO LISTEN:


Blockforce Capital’s Reality Shares ETF Trust has announced they will be withdrawing their exchange-traded fund proposal for bitcoin futures.

According to U.S. Securities and Exchange Commission (SEC) notes, the company withdrew its ETF proposal at the wish of SEC employees.

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“I can confirm that we did withdraw it and it was withdrawn because the staff are still taking the position that it’s not appropriate to file a registered 40 Act fund with cryptocurrency exposure at this time,” said a lawyer for Reality Shares.

Under the Investment Company Act of 1940, the proposal would have been approved automatically after 75 days and was the main concern of the SEC.

The proposed ETF included a portfolio of bitcoin futures from both the Cboe and the CME exchanges, as well as, sovereign debt instruments.

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BITCOIN, BLOCKCHAIN

ICE: Bakkt Delays Bitcoin Futures Launch to January 24

Bakkt, Intercontinental Exchange’s bitcoin (BTC) futures trading platform, has announced they will be delaying its launch until January 24, 2019.

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Originally slated to launch on December 12, the platform clarified “the new listing timeframe will provide additional time for customer and clearing member onboarding prior to the start of trading and warehousing of the new contract.”

In an official statement, Bakkt CEO Kelly Loeffler said the “volume of interest” and the “work required to get all the pieces in place” added to the delay.

Kelly Loeffler
Kelly Loeffler

“As is often true with product launches, there are new processes, risks and mitigants to test and re-test, and in the case of crypto, a new asset class to which these resources are being applied. So, it makes sense to adjust our timeline as we work with the industry toward launch.”

The new late January launch date is still subject to regulatory approval.

The Bakkt platform promises to offer physically-settled BTC futures, allowing customers to receive BTC upon contract completion, rather than cash settlements.

In the new statement, Loeffler hinted the platform may offer more cryptocurrencies stating “we are taking opportunities in our start-up phase to expand our offering.”

“We’ll share more about some of these new features in the coming weeks but as a start, I’m pleased to announce that we have insurance for bitcoin in cold storage and are in the process of securing insurance for the warm wallet within the Bakkt Warehouse architecture,” she said.

Bakkt previously announced it was working with Microsoft, Starbucks, and BCG, adding the companies have provided assistance in both risk management and customer service for the product.

Question: Why are you starting with bitcoin, and will you add other digital currencies?

Answer: Bitcoin today accounts for over half of total crypto market capitalization and has been deemed to be a commodity, and its derivatives are regulated in the US by the CFTC. As the world’s most liquid and widely distributed cryptocurrency, and where we’ve seen the most customer demand, bitcoin’s profile creates a liquid product on which to build a futures contract. We’ll consider additional contracts as the landscape evolves and as we receive additional customer feedback about what they want and need.

Question: How is the price of bitcoin going to be established?

AnswerGiven the transparency and regulation of the futures markets, the futures price in a one-day physically settled bitcoin contract will serve as a price discovery contract for the market. There is no reliance on cash platforms for settlement prices for pricing the daily bitcoin futures contract.

Question: When will trading and warehousing begin?

Answer: We expect the contract to launch on January 24, 2019, subject to regulatory approval. We’ll continue to update you on our progress and milestones.

Question: Is Bakkt hiring?

Answer: Yes, inquiries may be sent to info@bakkt.com. We are focused on building a nimble, entrepreneurial team with a focus on serving our customers and delivering results. Key success factors in our culture include collaboration, problem solving, communication, integrity, and professionalism and leadership.

Thank you for your continued interest and feedback as we build out Bakkt. As we talk with those in this space, we are motivated by the opportunity to help shape the future of digital currency. We look forward to updating you on our progress in coming weeks.

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