As more and more money rushes into cryptocurrencies for a safe haven, it is only natural that the investment side of the crypto business is also starting to heat up as well. In the latest move, Intercontinental Exchange's Cryptocurrency Venture has agreed to acquisition by VPC Impact Acquisition Holdings, Inc. (ticker VIH). VIH is what is known as an SPAC or Special Purpose Acquisition Company. SPACs are shell companies whose only function is to acquire other companies and bring them onto the stock market.

Reverse Merger

Rather than going through the many regulatory hurdles of making an IPO under their own name, Intercontinental can spin off this part of their business and get it onto the exchange much faster and with less regulatory interference by allowing it to be "acquired" by an existing firm already listed on the exchange. The process is technically a reverse merger but a very specialized one that is distinct in almost everything except name.

Under a standard reverse merger format, ICE would spin off the crypto side of the business into a separate company, which would then be free to pursue its destiny any way it wants. Instead, ICE will retain a majority stake in the new venture, which will be known as Bakkt, while VIH will put upwards of 500 million dollars into the new enterprise in the form of marketing and product development.

Bakkt Killer App

The underlying purpose of the Bakkt venture is to create a killer app for consumer use of cryptocurrencies and other digital assets such as rewards points, loyalty bonuses, and even credits from video games. By folding all of these disparate programs into one easily-accessed processing point, the company hopes to gain a foothold in all things crypto no matter where they originate from.

The price of Bitcoin continues to grow, and it recently hit values over $16,000. The cryptocurrency's values nearly doubled over the last two weeks. Institutional war chests are probably doing most of the movement at this point, considering that the market cap now reached nearly $300 billion. This raises the stakes for traders to new heights.

Different exchanges have been citing different prices over that time period. While everyone had the price of Bitcoin pegged at around $8,000 just 14 days ago, the Coinbase GDAX exchange approached the $19,000 mark. Most other exchanges had the price of Bitcoin positioned at a much lower value. These drastic differences are making it difficult to predict market fluctuations with any degree of certainty.