Former Coinbase employee Adam White has left the exchange he’s worked so hard to build to join Bakkt – set to make its official debut in November – as its new COO. White was Coinbase’s fifth employee and began in 2013 when those in charge were primarily working from home.
Bakkt was first announced in August as a joint venture between the Intercontinental Exchange (ICE), coffee king Starbucks and software giant Microsoft. The platform is designed to offer high-end players the chance to trade, sell and purchase digital currencies in a more formal, regulated environment.
In addition, Bakkt is also seeking to release physical, one-day bitcoin futures contracts that upon expiration, will reward their holders with bitcoins rather than cash. The company is currently awaiting approval from the Commodity Futures Trading Commission (CFTC).
Why Won’t They Get Involved?
Institutional investors have long been labeled the “answers” to making bitcoin and its crypto-cousins more mainstream. The trouble is cryptocurrency is very volatile; the space also lacks access to custody and other banking services typically witnessed in the traditional finance arena. As a result, larger players have been reluctant to get involved out of fear that their money might disappear overnight.
Bakkt seeks to make this fear go away by offering a closely monitored atmosphere for crypto-traders to enjoy. The platform is expected to bring further maturity to the crypto space (along with a few price hikes).
Sad To See You Go
White’s departure from Coinbase was announced in early October. A company representative stated:
“We wish Adam all the best and are proud of what we call the “Coinbase Mafia” – an increasingly impressive group of alumni who are driving the crypto space forward. While we’re extremely sad to see him go, we’re also confident in the group’s ability to keep executing on the vision that he laid out to be the most trusted venue for institutional investors to trade cryptocurrencies.”
White’s departure is intriguing in the sense that Bakkt is designed for further institutional play, a goal Coinbase has been working hard to accomplish all year. Recently, the company launched a custody service as well as plans for an index fund, though they’ve since been scrapped in favor of a new retail product. The company’s native exchange, GDAX, was also rebranded to “Coinbase Pro” earlier this year.
Explaining His Reasons
White has faced some criticism from crypto-purists who claim he’s “siding with the establishment.” However, he sees the situation in a very different light:
“I had a front row seat for the last couple of years watching the money managers’ and other big investors’ evolving views of cryptocurrencies. In 2017, I saw a big shift. The interest in bitcoin and other currencies started changing from retail to the institutional side, but the level of infrastructure of the existing trading sites often didn’t meet their expectations. That’s why they’re waiting on the sidelines and why I joined Bakkt.”
White believes Wall Street is ready to begin packaging digital assets for the public and particularly for millennials, which have shown widespread enthusiasm for virtual coins. He also says exchanges are beginning to offer safety features similar with what institutional investors see in trading equities, gold and bonds.
Don’t Be Fooled by Low Prices
Despite the ongoing bear market, White is confident investor interest in bitcoin and cryptocurrencies is stronger than ever. He says that people are concentrating too hard on the current prices to really see anything further:
“Far too often, the public looks at price and market size to determine the progress in digital currencies. Cryptocurrency markets go their own way; we see bull and bear markets, but what matters is that the number of daily transactions for all cryptocurrencies has moved up year over year. We’re also seeing the introduction of new protocols from open source software developers that make cryptocurrencies far easier to use.”