CoinFLEX, an offshore exchange trading BTCUSDT deliverable futures, has over 100x that volume, and the overall cash-settled futures market has over 1,000x that volume.
So why did Bakkt fail so badly? A number of reasons:
1. No/low leverage: crypto traders love to use leverage and when done wisely it is a critical part of a trader's risk management toolkit. Bakkt has 1-day expirees and no leverage.
2. The market doesnt want deliverable futures: deliverable futures require that the exchange have reliable USD access for the longs to deliver. Some offshore exchanges like CoinFLEX use stablecoins as a proxy for USD, but for truly deliverable futures that institutions want to trade, this requires a solid banking connection. But the reality is most traders at the moment in crypto just want to move crypto around and earn more bitcoin on trades, and they want the profits fluid, liquid and available right away. This is what the top exchanges in the space use: BitMEX, OKex, Huobi, Deribit, and they just arent interested in juggling two types of assets when they can just use bitcoin.
3. Verification barrier: if you want to trade on OKex or BitMEX you just provide an email. If you want to trade on Bakkt, you have a higher barrier to entry because you have to have a fully verified account and go through a longer, tedious onboarding process and regulators will be scraping the trading activity there very aggressively and potentially invading your privacy down the line.
4. Bad market timing: I saved this for last because it is the worst excuse, but there is currently a market environment that is quite bearish, volumes are relatively low, and a lot of value in crypto, particularly lower on the totem pole, is bleeding out as you read this.
Time will tell if Bakkt goes the way of Cboe (unlikely because they are a separate venture and are quite focused on driving value, rather than being a pet project like Cboe), or if they will start making an actual dent in Bitcoin-Dollar futures marketshare.