Digital asset company Bitcoin told regulators this week that it is running out of money, citing a “fast-growing environment” in the crypto industry.
The company — which once boasted major partners like Starbucks and MasterCard and linked its seed to the firm that owns the New York Stock Exchange — doesn't have enough cash to continue operating for the next 12 months, according to the SEC on Tuesday. .
Bakkt has revised its quarterly report since November to update risk disclosures. The company had announced a major international expansion.
“There is significant uncertainty associated with our expansion into new markets and the growth of our revenue base in the rapidly growing area of crypto assets,” the company said. As a result, Bakkt said we cannot conclude that we will be able to significantly increase earnings without raising additional funds in the near term.
Bakkt was launched in It is a crypto platform developed in 2018 by Intercontinental Exchange, which owns the New York Stock Exchange. It initially focused on enabling consumers to use digital assets in collaboration with major brands.
The company hit the stock market at a valuation of $2.1 million and went public in 2021 through a SPAC, a special purpose acquisition company created through a merger. It has marketed a digital wallet targeting “marquee brands” like Best Buy, which it says “brings Bitcoin and other digital assets into one platform.”
But Bakht later changed its strategy and offered crypto trading and protection services to financial institutions and fintech companies instead of serving consumers directly. The company's new “business-to-business-to-consumer approach” focuses on enhancing business by integrating crypto solutions into customer environments.
Although the company is not completely done with users.
Last April, Bakkt acquired another crypto platform called Apex Crypto and renamed it Bakkt Crypto Solutions. Referring to it as a “B2B2C” play, the company said it expects Bakkt Crypto's trading platform and liquidity provider relationships to enhance its product lineup. However, Bakkt has removed dozens of crypto assets from its platform, including Solana and Cardano, amid regulatory scrutiny over whether certain tokens are considered unregistered securities.
And late last month, Bakht announced it was expanding its international footprint with a focus on Latin America and Asia.
That expansion, Bakkt says, introduces uncertainty. And the overall crypto market crash and collapse of major industry players like FTX has also created a headwind.
Bakkt told the SEC that filing the business transfer added risks and uncertainties. He also mentioned that he did not get enough income to avoid the financial shortage. The company said it is looking to raise additional financing to meet its demand next year.
Bakkt's stock price ( BAKKT/NYSE ), up nearly 90% over the past year, rose from $1.47 to $1.29 shortly after its updated quarterly SEC filing.
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