Markets
Cryptocurrency market Bakkt considers a potential breakout or sell-off as the market recovers
Bakkt Holdings, the digital asset marketplace launched by the parent company of the New York Stock Exchange (NYSE), is reportedly considering a potential sale in light of growing acquisition activity within the marketplace cryptocurrency sector.
Bakkt evaluates strategic alternatives
Second At Bloomberg, sources familiar with the matter revealed that Bakkt has hired a financial advisor to explore various strategic options, including a potential breakup. However, no final decision has been made.
Intercontinental Exchange (ICE), owner of major futures markets and the NYSE, launched Bakkt with great anticipation. The venture was announced in collaboration with Starbucks and Microsoftgarnering considerable attention.
Kelly Loeffler, CEO and founder of Bakkt, later served as a U.S. senator from Georgia for a year. Earlier this year, Bakkt faced the risk of delisting by the NYSE after revealing potential challenges in continuing to operate as a going concern.
Bakkt, which provides several services, including trading and custody, enters the market during a period of consolidation in the digital asset industry.
However, cryptocurrency prices have risen to near record levels tallprompting some companies to consider expansion while others continue to recover from the industry-wide downturn two years ago.
Potential breakage taken into account
Bakkt went public in 2021 through a merger with a blank check vehicle. In the first quarter of this year, the company reported a loss of $21 million on revenue of $855 million. On Friday, Bakkt unveiled a partnership with Crossover Markets to develop a cryptographic electronic communication network (ECN), further expanding its offering.
Bakkt holds the coveted New York State Department of Financial Services Bit License, a regulatory license required to operate in the state.
Following the news, the company’s shares rose 15% to $22.33 on Friday, a 27% increase for the week. The company’s market value is approximately $300 million. However, Bakkt shares are down about 30% over the past year.
Overall, as the digital asset marketplace company explores potential strategic options, including a potential sale, in response to heightened activity in the cryptocurrency space, it faces a crucial crossroads.
Bakkt’s suite of services, BitLicense approval, and recent partnership announcements position it as a significant player in the market. Nonetheless, industry players will be closely monitoring the company’s future trajectory and determination to remain independent or seek a buyer.
As of the last update, the total market capitalization of the cryptocurrency market has fallen below the $2.5 trillion mark. This decline was mainly caused by the decrease in the price of Bitcoin (BTC), the largest cryptocurrency by market capitalization. Bitcoin has dropped from $71,000 and is currently valued at around $69,000.
Featured image from Shutterstock, chart from TradingView.com