NYDFS Authorizes Bakkt Trust Company to Provide Bitcoin Custody Services | Practical Law

NYDFS Authorizes Bakkt Trust Company to Provide Bitcoin Custody Services | Practical Law

The New York Department of Financial Services (NYDFS) announced that it has granted a charter under New York Banking Law to Bakkt Trust Company LLC, a cryptocurrency platform that in an affiliate of Intercontinental Exchange, Inc. (ICE). Under the charter, Bakkt is authorized to operate as a limited liability company and to provide bitcoin custody services in conjunction with the launch of physically delivered bitcoin futures contracts.

NYDFS Authorizes Bakkt Trust Company to Provide Bitcoin Custody Services

Practical Law Legal Update w-021-7870 (Approx. 3 pages)

NYDFS Authorizes Bakkt Trust Company to Provide Bitcoin Custody Services

by Practical Law Finance
Published on 21 Aug 2019USA (National/Federal)
The New York Department of Financial Services (NYDFS) announced that it has granted a charter under New York Banking Law to Bakkt Trust Company LLC, a cryptocurrency platform that in an affiliate of Intercontinental Exchange, Inc. (ICE). Under the charter, Bakkt is authorized to operate as a limited liability company and to provide bitcoin custody services in conjunction with the launch of physically delivered bitcoin futures contracts.
On August 16, 2019, the New York Department of Financial Services (NYDFS) announced that it has granted a charter under New York Banking Law to Bakkt Trust Company LLC, a cryptocurrency platform that is an affiliate of Intercontinental Exchange, Inc. (ICE), which also owns the New York Stock Exchange (NYSE). Under the charter, Bakkt is authorized to:
Bakkt will serve institutional customers. Its bitcoin futures contracts will be listed for trading on ICE Futures US and cleared through ICE Clear US, both of which are affiliates of Bakkt. ICE Futures US issued a notice stating that it will list the new Bakkt bitcoin futures contracts starting on September 23, 2019. Investors in the Bakkt bitcoin futures contracts will receive their payout in bitcoin, instead of dollars.
Both of the Bakkt daily and monthly bitcoin futures contracts were approved in May 2019 through the CFTC's self-certification process.
The NYDFS press release states that to date, it has approved 22 charters or licenses for companies in the virtual currency marketplace.
For information on the regulation of virtual currency, see Practice Note, Virtual Currency Regulation: Overview and Virtual Currency and Digital Asset Regulatory Tracker.