sludgefeed.com
Intercontinental Exchange’s (ICE) startup crypto exchange subsidiary, Bakkt, announced on Wednesday that it has formed a partnership with cryptocurrency-focused merchant bank Galaxy Digital (TSXV:GLXY) to launch a joint trading and custody service tailored to institutional investors.
According to the announcement, the companies plan to offer a “white-glove” service for institutional asset managers looking to acquire, build positions in and store Bitcoin (BTC).
“We designed this partnership to service the uptick in demand our two firms have received from traditional asset managers seeking access to physical bitcoin,” said Tim Plakas, head of sales at Galaxy Digital Trading. “These funds expect the same caliber of market knowledge and trade execution expertise in BTC as they would expect from any established traditional finance desk, and Galaxy provides that, while Bakkt delivers the high level of regulatory-compliant security required for storing digital assets. Together, Galaxy Digital and Bakkt offer a safe, efficient, and well-regulated route into physical bitcoin access, one that has been already proven successful in the macro hedge fund space.”
Bakkt’s custody offering, dubbed the Bakkt Warehouse, includes both warm (online) and cold storage and is covered by a $125 million insurance policy.
“Alongside our adoption of safekeeping requirements that are unique to the digital asset class and its infrastructure, the Bakkt Warehouse uses the same best-in-class, trusted enterprise security framework that protects ICE’s dozen exchanges around the world, including the New York Stock Exchange,” said John Conneely, Bakkt’s head of custody business development. “As one of the largest trading operations in the digital asset space, Galaxy Digital’s execution expertise and Bakkt’s custody solution are highly complementary.”
Bakkt’s other major initiative, a retail-focused crypto app, is still under development, although recently revealed details show the app will link with other third-party wallets and feature loyalty and game reward points.
According to a blog post by Bakkt’s president, Adam White, Bakkt plans to make “digital assets like airline miles, loyalty points and cryptocurrencies more accessible, useful, and trusted.”
Taken together, it looks as though Bakkt is building out a Coinbase-esque product line that caters to both retail and institutional investors.