Bakkt Holdings Explores Strategic Options Between Crypto M&A Boom

Bakkt Holdings Inc., the digital asset marketplace founded by Intercontinental Exchange Inc. (ICE), is contemplating a potential sale as mergers and acquisitions surge in the crypto sector. According to Bloomberg reporters Matthew Monks, David Pan, and Gillian Tan, Bakkt has enlisted a financial advisor to assess strategic options, including a possible breakup. However, a final decision has not been made, and Bakkt may continue operating independently. Representatives for Bakkt have declined to comment on these developments.

Launched in 2018, Bakkt came into the market with high expectations, backed by ICE—the parent company of the New York Stock Exchange—and in partnership with Starbucks Corp. and Microsoft Corp. Kelly Loeffler, Bakkt’s founding CEO, went on to serve as a U.S. Senator from Georgia. Despite these high-profile beginnings, Bakkt faced potential delisting from the NYSE earlier this year after expressing doubts about its ability to continue as a going concern, Bloomberg reported.

Bakkt provides a range of services, including trading and custody solutions, which are now being re-evaluated as part of the company’s strategic review. This comes amid a wave of consolidation in the digital asset industry. With cryptocurrency prices approaching record highs, some firms are looking to expand, while others recover from the downturn experienced two years ago. For instance, Robinhood Markets Inc. recently acquired European crypto exchange Bitstamp, and Riot Platforms Inc., one of the largest Bitcoin miners, proposed taking over rival Bitfarms.

Financial Performance and Future Plans

After going public through a merger with a special purpose acquisition company (SPAC) in 2021, Bakkt reported a first-quarter loss of $21 million on revenues of $855 million. Despite financial hurdles, Bakkt continues to innovate. Recently, it partnered with Crossover Markets to develop a crypto electronic communication network (ECN), signaling its commitment to advancing digital asset trading technology.

Bakkt also holds a BitLicense from the New York State Department of Financial Services, allowing it to legally operate in New York. This regulatory approval underscores Bakkt’s credibility and operational compliance within the highly regulated U.S. market.

As Bakkt navigates its future, the company’s decisions will be closely watched by the industry, given its significant role and the high-profile backing it has received since its inception.