Bakkt CEO on the interconnection between crypto and the traditional financial system

In a cryptocurrency panel hosted by Yahoo Finance's Jennifer Schonberger, Bakkt CEO Gavin Michael discusses the future of cryptocurrencies and the traidtional banking system.

Video transcript

JENNIFER SCHOENBERGER: How is Morningstar recommending investors gain exposure here? Just last week, the SEC greenlighted the first Bitcoin futures ETFs. Certainly, that makes it easier for investors to gain exposure. But is that necessarily the best way? Should they perhaps also consider going to cryptocurrency exchanges, as has been the other way before these ETFs, to invest in the outright underlying digital assets?

AMY ARNOTT: Yeah, so there are a lot of benefits that come along with the ETF format. It gives you more transparency. It's easier to buy through an existing brokerage account. But because the two ETFs that are available in the US so far are buying futures contracts, they're probably not going to track the Bitcoin price exactly. They could be maybe 5% or 10% off each year.

So they're buying the front month futures contract. So as these contracts roll over, they will probably have to be buying it at a higher price. I think we will eventually see a crypto ETF that tracks the spot price. But at this point, if you're looking to add crypto exposure to your portfolio, you're probably better off buying it directly through a crypto exchange or platform.