Bakkt becomes ICE performance champion and will launch digital asset payment app in 2020

The New York Stock Exchange (NYSE) and cryptocurrency company Bakkt's parent company Intercontinental Exchange (ICE) announced 2019 results on a fourth-quarter earnings call.

It is reported that the company's fourth quarter earnings per share (EPS) increased by 1% year-on-year, from 0.94 US dollars per share to 0.95 US dollars per share.


ICE CEO Jeffrey Sprecher said:

"We are pleased to announce that this is our 14th consecutive year of record revenue. Leveraging our leading technology and market expertise, we have added our risk management solutions, added new products and Services, while adding products and services from multiple locations. "


(ICE fourth quarter results)

During the meeting, the Bakkt and ICE Abu Dhabi divisions were identified as key growth projects for the company's business.

Committed to the popularization of consumer applications in 2020

Sprecher outlined Bakkt's history and highlighted its plans to acquire Bridge2 Solutions, a company that offers loyalty reward programs.

He said that this would "accelerate our digital asset strategy in the second phase."

"More than a year ago, we described Bakkt's future plans. Our mission is to build a broader ecosystem to support the entire life cycle of digital assets."

He added that the acquisition will make Bakkt "a market for aggregators and trading large numbers of digital assets."

As for how ICE will judge the success of Bakkt, Sprecher said in a Q & A session that the focus in 2020 will be on the "widespread popularity" of consumer applications.

"We focus on consumer acceptance, not income or expenditure. We have had multiple conversations with large consumer brands and merchants."

Sprecher also commented on a report in the Wall Street Journal. The report stated that ICE had approached eBay on the acquisition. Given ICE's desire to innovate in emerging asset classes, such a deal makes sense.

"Is there a market for swords and sickles in the game?"

"We have not lost our sanity. We are very satisfied with our ability to continue to find more asset classes."

Behind Bakkt consumer applications

The acquisition of Bridge2 is expected to be completed later this quarter, and upon completion of the transaction, Bridge2 will be merged into Bakkt.

Bakkt will use Bridge2's merchant relationships to build its consumer-facing application, which will provide users with a wallet to store a range of digital assets, including cryptocurrencies and loyalty rewards.

According to Fortune, Bridge2 has managed a $ 60 billion loyalty rewards points platform for merchants and financial institutions. The company is also conducting a pilot program for Loyalty Pay, which allows companies to issue rewards-linked credit cards.

An ICE spokesperson said the app will launch in the first half of this year, adding that "users will be able to use Bakkt to make payments at any merchant through a variety of direct and indirect access."

Users of this app can also convert Bitcoin, points and internal rewards in real time. A spokesperson said that Loyalty Pay will be integrated into the app, but it will still be a standalone solution.

Bakkt contract performance

In addition, the trading volume of Bitcoin futures products launched by Bakkt in September 2019 continued to grow.

According to data provided by Skew, on February 5, the open interest of this monthly contract reached a historical high of US $ 12.6 million, with a total transaction value of US $ 16.4 million, and the total transaction value of the product since its launch exceeded US $ 1 billion.


(Bakkt open contracts and trading volume)

The company also recently launched options products linked to physical delivery futures contracts.

According to an earlier report by Babbitt , the product was less successful than futures contracts, with no transactions for 10 days at the end of January.


(Bakkt Bitcoin Options Trading Volume)

As of February 5, Bakkt options contracts had an open interest of $ 200,000. So far, the contract's trading volume has reached $ 1.9 million.