Bakkt, the recently launched U.S. regulated bitcoin futures/custody ecosystem, announced today that on December 9th, it will launch a new options contract based on its monthly bitcoin futures contract.
“The new contract is based on customer feedback and is designed to hedge or gain bitcoin exposure, generate income, and offer cost and capital efficiencies. ICE Futures U.S. has self-certified the contract with the CFTC and we’re excited to leverage the benchmark futures prices and institutional-grade custody to meet the needs for a regulated options contract.”
– Kelly Loeffler, CEO of Bakkt
Features of the Bakkt Bitcoin Options contract:
- Margin – margined contracts, and cross-margining with the underlying futures contract
- Cash/Physical Settlement – the option settles into Bakkt’s monthly bitcoin futures contract with time to roll, closeout positions or take physical delivery
- European Style – contract design avoids early exercise and reduces operational burdens
- Fees – $1.25 per options contract (1 contract = 1 bitcoin) starting in January 2020, following the fee waiver in December 2019
- Liquidity – ICE Futures U.S. markets are accessible globally and have dedicated market makers to support liquidity
- Instant Messaging – collaborate with other market participants using ICE Chat, which can be tailored to support compliance requirements
- Block Trading – access more trading opportunities as block trades by leveraging ICE Block
- Analytics – use ICE Options Analytics to support options valuation, analysis, and risk management
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