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Bakkt could be behind Bitcoin price crash, JP Morgan report suggests

By Ramla Soni

The launch of Intercontinental Exchange’s (ICE), Bakkt, is allegedly responsible for Bitcoin’s (BTC) latest price crash, according to a report by JP Morgan Chase & Co, Decrypt reported.

The project's price fell more than 20% from $10,026 to today’s price of $7,933.

Bakkt is a bitcoin futures exchange and digital assets platform founded in 2018 by the Intercontinental Exchange (ICE) which also runs the New York Stock Exchange.

On Bakkt, investors could bet on the future price of Bitcoin, and place and receive those bets in Bitcoin too.

While the JP Morgan report noted that the Bakkt contracts are a welcomed sign of the crypto market growing up, trading has been relatively underwhelming.

Currently just 54 Bitcoin is being traded ($430,000).

But the JP Morgan report suggested that it may be “the listing of physically settled futures contracts (that enables some holders of physical Bitcoin to hedge exposures that has contributed to recent price declines, rather than the low initial volumes”.

Tokenised securities are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how tokenised securities and leverage work and whether you can afford to take the high risk of losing your money. Nothing in the above article should be regarded as a recommendation to trade generally, to trade on a particular platform or to trade in a particular asset. Asset prices can go down as well as up and past performance is not a guide to future performance. Investors and traders should thoroughly research an asset or strategy before making any trading or investment decision and if necessary seek professional advice.

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