Bakkt Weighing Up Platform Sale After Downturn

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  • Bakkt Holdings Inc. has reportedly considered putting itself up for sale.
  • The company has admitted it might not be able to continue in its current form following competition from Bitcoin ETFs
  • The company’s BitLicense could be key to a sale

Bakkt Holdings Inc., the digital asset marketplace that was once held up as the future of institutional crypto adoption, is reportedly considering putting itself up for sale. The company, which is owned by the parent company of the New York Stock Exchange (NYSE), is contemplating a potential sale following an admission that it might not be able to continue in its current form. The launch of multiple Bitcoin ETFs, and the ease with which institutions can now access Bitcoin, has led to reduced usage of the platform, exemplified by a first-quarter loss this year.

Bakt Buzz Failed to Last

Bakkt launched in 2018, with the crypto community hoping that it would open the floodgates to both consumer usage of Bitcoin and institutional adoption. Things haven’t quite panned out that way, however, and Bakkt is hoping to make the most of an increase in crypto-related acquisitions having fallen down the pecking order for both institutional and consumer users.

Bloomberg reports sources familiar with the situation as saying that Bakkt has engaged a financial advisor to explore various strategic options, including a possible breakup. These sources requested anonymity as the details are not yet public. No definitive decision has been made, and Bakkt might still decide to remain independent.

Intercontinental Exchange Inc. (ICE), which operates some of the most significant futures markets along with the NYSE, launched Bakkt with Starbucks and Microsoft, but, in a sign of how much its star has fallen, Bakkt faced the risk of being delisted from the NYSE after disclosing potential challenges in continuing as a viable business.

BitLicense Could Hold Key to Sale

Bakkt provides a range of services, including trading and custody, and enters the market as consolidation intensifies in the digital asset sector, with crypto prices approaching record highs. While some companies are looking to expand, others are still dealing with the aftermath of an industry-wide downturn two years ago. For instance, Robinhood Markets Inc. recently announced its intention to acquire the European crypto exchange Bitstamp, and Riot Platforms Inc., one of the largest Bitcoin miners, proposed a takeover of its competitor Bitfarms.

In 2021, Bakkt went public through a merger with a blank-check company. The firm reported a first-quarter loss of $21 million on $855 million in revenue. On Friday, Bakkt revealed a partnership with Crossover Markets to develop a crypto electronic communication network (ECN).

Bakkt holds a coveted BitLicense from the New York State Department of Financial Services, a significant credential in the industry and something that will act as a huge feather in its cap if it comes to a sale.