The application that Bakkt, will now be launching makes it easy for users to store money, crypto, loyalty points and game points. It will also make it seamless to transfer these values to other people quickly and cheaply. It may sound brilliant, but they have strong competitors on all verticals, especially at Coinbase and Binance.
Mass adoption of crypto
In order for “mother and father” to have a relationship with cryptocurrency, the user experience must be so simple and advantageous that it outperforms banking applications, such as Vipps. Bakkt has chosen a good UX, with a focus on simplicity. Where the Bakkt crypto exchange is only offered to institutional investors, the application is aimed at the man in the street. The user interface is close to Vipps, Revolut, RobinHood etc. They have largely chosen to be free to the common man.
Private individuals can choose to trade cryptocurrency on several different platforms and exchanges. Everyone has heard of the great US giant Coinbase, about Binance opening offices worldwide or seeing the record high trading volume on BitMEX. These players offer various products, but their size is tens of millions of customers. Bakkt is attacking all three. They offer a solidly regulated marketplace, with the entire world as a field of impact and leverage through bitcoin futures. You don’t have to spend your money on Seychelles or Panama to take advantage of advanced functionality.
Finance born again
The largest growth in cryptocurrency over the past year has been in the Decentralized Finance (DeFi) segment. Through smart contracts, savers can lock in cryptocurrency and receive high interest rates, as the smart contract lends the same cryptocurrency back to the market. Zero overhead or back office, only automated deposit and lending. Bakkt will offer such savings schemes in its app, and will attack both the entire DeFi market and the ordinary savings market if they get their breakthrough. The advantage for competitors may be that they can be part of an assortment, but if the margins are good enough, it is obvious to think that Bakkt will develop its own solutions.
Many are predicting an exciting future for big brands that choose to tokenize loyalty points, thus making the points freely negotiable with third parties as well. The airline Norwegian has stated plans to turn its Reward Points into liquid tokens, which can be used on a wide range of services and products, not necessarily offered by the airline itself. Imagine being able to combine the Trumf points with Norwegian Reward so you can buy a pair of trousers in a clothing store. Then the brands can finally compete to provide extra value. Service providers can reward users for recruitment and use. Product managers can score points if you choose their product. Bakkt incorporates a functionality in its app where you store and trade tokenized loyalty points. This means that they are the brands in the industry when it comes to storage and use. What will customers choose? All in one place or 20 apps on the phone?
In game purchases are how games today make money. Now blockchains are entering the stack of big games and franchises. The revolution lies in the fact that you can take the assets out of the game and use it elsewhere, because it may be on the Ethereum chain. Then you can also sell the assets in third-party marketplaces. You can sell your sword from a fantasy game on a stock exchange for Ethereum non-fungible tokens, or you can sell your football card on Bakkt’s new app. neither out nor in to use their tokens “in game”.
Bakkt strikes widely, they attack ‘everyone’ and aim to offer a product that meets all your needs, but they are not alone. This strategy certainly underpins Coinbase and Binance as well. What is certain, on the other hand, is that margins will be squeezed and the costs to users will be low during the time all three capitalized companies will now compete to be the largest. For most consumers and the evolution of the cryptocurrency market, including tokens, this is a dream situation.