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Bloomberg News, citing sources familiar with the matter, reported that Bakkt is considering strategic options such as sale or spin-off. The move comes amid a surge in acquisition activity within the cryptocurrency sector.
Bakkt is working with financial advisors to evaluate its options, the sources said, speaking on condition of anonymity due to the confidentiality of the matter. However, no final decision has been made and the company may choose to go independent.
Bakkt was launched in 2018 by Intercontinental Exchange, which owns several major futures markets and the NYSE. The venture’s founding CEO, Kelly Loeffler, later served as a U.S. senator from Georgia for a year. Earlier this year, Bakkt faced the risk of being delisted from the NYSE after disclosing that it may not be able to continue as a going concern.
Increased cryptocurrency merger and acquisition activity
Bakkt’s potential sale comes as consolidation activity heats up in the digital asset sector, with cryptocurrency prices nearing all-time highs. Some companies are considering expansion, while others are still recovering from the industry-wide collapse that occurred two years ago. Recent examples of consolidation include Robinhood’s acquisition of European cryptocurrency exchange Bitstamp and Riot Platforms Inc.’s proposed acquisition of rival Bitfarms.
Bakkt, which went public in 2021 through a merger with Baekji Corporation, reported a loss of $21 million on revenue of $855 million in the first quarter. The company also recently announced a partnership with Crossover Markets to develop an encrypted electronic communications network (ECN).
One of Bakkt’s valuable assets is its BitLicense from the New York State Department of Financial Services, which allows it to operate within the state. Other major industry players holding these licenses include cryptocurrency exchange Coinbase, stablecoin issuer Circle, and Jack Dorsey’s digital payments company Square.
Bakkt shares rose 15% to $22.33 on Friday following news of a possible sale, bringing the company’s market value to about $300 million. Despite this recent increase, the stock is down about 30% over the past year.
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