Bakkt examines a major sell-off or split in crypto M&A activity.
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An initial report from Bloomberg, citing people familiar with the matter, indicated that Bakkt is considering strategic options, including a sale or separation. The move comes amid increasing regulatory activity in the cryptocurrency sector.
The sources, who asked not to be named due to the confidentiality of the matter, revealed that Bakht has been reviewing his options with a financial advisor. However, a final decision has not been made, and the company may choose to remain independent.
Bakkt was launched in 2018 by the Intercontinental Exchange, which owns several major futures markets and the NYSE. The venture's founding CEO, Kelly Loeffler, later served as a one-year U.S. senator from Georgia. Earlier this year, Bakkt faced delisting from the NYSE after it declared it could no longer continue as a going concern.
Increase in crypto integration and acquisition activities
Bakkt's potential sale comes as consolidation activity heats up in the digital-asset sector, with crypto prices nearing record highs. While some companies are considering expansion, others are still recovering from the industry-wide downturn of two years ago. Recent examples of consolidation include Robin Hood's European crypto exchange Bitstamp and Riot Platforms Inc. They include a planned acquisition to take over rival Bitfarms.
In the year Bakht, which went public in 2021 after merging with a blank check vehicle, reported a loss of $855 million on revenue of $21 million in the first quarter. The company recently announced a partnership with Crossover Markets to develop the Crossover Electronic Communications Network (ECN).
One of Bakkt's most important assets is its BitLicense from the New York State Department of Financial Services, which allows it to operate in the state. Other major industry participants with this license include crypto exchange Coinbase, stablecoin issuer Circle, and Jack Dorsey's digital payments firm Square.
Following news of the potential sale, Bakht shares rose 15 percent to $22.33 on Friday, bringing the company's market value to around $300 million. Despite this recent surge, the stock has fallen roughly 30% in the past year.
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