Crypto Firm Bakkt Warns of Financial Struggles, Doubts Continuity In Business
Bakkt Holdings, a cryptocurrency platform launched with great fanfare in 2018 by the parent company of the New York Stock Exchange, warned on Wednesday it may not have enough capital to stay in business.
In a regulatory filing, Bakkt said there is doubt over whether its available cash can sustain ongoing operations for the next 12 months.
Key Details:
- Bakkt was founded by Intercontinental Exchange (ICE), owner of major stock exchanges like NYSE.
- After pivoting to digital asset tech services, Bakkt has struggled amid plunging crypto markets.
- Filing warns that available funds are not sufficient to maintain operations for another year.
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When Bakkt debuted in 2018, the crypto industry was riding high despite a brewing bear market. The company promised to unlock institutional investments by developing regulated custody and markets for digital tokens like Bitcoin.
However, as crypto prices plunged the following year, Bakkt eventually planned to roll out a digital wallet app in 2021 tied to a customer loyalty program. It also shifted focus to providing technology infrastructure, enabling banks, retailers, and other firms to offer crypto services.
Bakkt Crypto Move Failed To Gain Traction
The crypto move failed to gain traction amid tightened spending and falling asset prices. The crypto market meltdown that accelerated in 2022 with the collapse of TerraUSD and other so-called stablecoins wiped out a substantial amount of value.
Now Bakkt appears at risk of becoming part of the crypto meltdown unless it can raise new financing. The firm said in a now-deleted post on X that it has filed an amended Form S-3 registration with the SEC. The firm mentioned that it will allow them to raise additional capital to sustain their vision.
