One of the most anticipated launches, Bakkt’s futures exchange, turned out to be a giant dud on the first day of trading. Now fingers are pointing at that as the reason bitcoin prices are went on the south side of the $8,000 level Tuesday afternoon.
After months and months and, well, even more months of buildup, Bakkt’s first day of trading saw volume of about two dozen bitcoins. Those are Bill De Blasio levels of apathy toward Bakkt’s contracts compared to the Chicago Mercantile Exchanges daily volume, which sees a couple of thousand bitcoin contracts change hands daily. Each contract is for 5 BTC.
Prices have been drifting lower since the launch but at around 2:45 p.m. ET, a massive selloff in a matter of minutes led Bitcoin to plunge $1,400 to $7,955, according to Bitstamp data.
“It’s a technical breakdown,” a trading desk told us. When asked what led to it, we were told “bad technicals.” Not satisfied with that answer, we pressed further. That’s when the finger pointing led to Bakkt.
Bakkt’s lousy volume number could be interpreted as a sign that the appetite for institutional involvement in Bitcoin isn’t as big as thought. Yet the CME’s volume is healthy.
As the CBOE found out with its own contract, maybe it’s not the market but the contract.