Latest report from New York has it that Bakkt, a popular cryptocurrency marketplace, is considering splitting up or selling amid a rebounding cryptocurrency market. The financial industry has taken notice of this noteworthy development, which has sparked concerns about the company’s viability and its effects on the larger Bitcoin ecosystem.
Intercontinental Exchange (ICE) launched Bakkt in 2018 to give institutional investors access to a regulated marketplace to purchase, sell, and store digital assets. At first, it established itself as a major player in the institutional use of cryptocurrencies, especially with its physically settled Bitcoin futures contracts.
Sources with knowledge of the situation claim that Bakkt is considering several strategic options, such as selling a portion of its firm or the entire enterprise. According to reports, as the market emerges from a protracted negative trend, the necessity to focus on core capabilities and optimize operations is driving this strategic review.
Rise in Bakkt’s Market Value Likely, Shift in Bakkt Operations Predicted
According to industry observers, Bakkt’s worth may rise due to the rebound. It is believed to be a desirable acquisition target for more significant financial institutions or IT companies wishing to strengthen their presence in the cryptocurrency sector. The possible dissolution or sale of Bakkt may significantly affect its stakeholders, including its workers, investors, and clients.
Due to this development and the possibility of new owners, the company’s future duties and job security may be uncertain for employees. Bitcoinist platform’s Ronaldo Marquez has stated that a profitable sale or strategic alliance could result in large returns, while a less fortunate conclusion could harm their investments.
Analysis from Bloomberg revealed that before Bakkt took the decision, it’d contacted few financial advisors to review some alternative options, one of which includes a likely breakup – which turned out to be the final resolution.
Bakkt Announces New Alliance After A Major Loss
Bakkt officially went public in 2021 after a merger with VPC Impact Acquisition Holdings. The company accounted for a $21 million loss after accounting for $855 million in total revenue. On Friday, Bakkt announced its official alliance with Crossover Markets in a bid to create a cryptocurrency Electronic Communication Network (ECN) in an attempt to expand the offering further.
Bakkt founder and CEO Kelly Loeffler is said to have served as a United States senator representing Georgia. In 2023, the company was almost delisted from the New York Stock Exchange (NYSE) after some undisclosed concerns were noted.
The company has faced several difficulties, such as heightened competition from rival cryptocurrency platforms and regulatory scrutiny. These elements, together with the erratic nature of the cryptocurrency market, have forced Bakkt’s management to reevaluate its strategy and consider tactical options to increase shareholder value.
Bakkt Stocks Drops, Dropping Price of Bitcoin Linked
Reports suggest that Bakkt owns an in-demand stake in BitLicense from the New York State Department of Financial Services, which is in charge of the regulatory license needed to start operations in the state. After the breakup news, the company’s shares increased by 27% on Friday to sell at $22.33, the first significant move in a week.
As of press time, BitLicense’s market value is $300 million. Bakkt stock, on the other hand, has dropped by 30% in the previous years. Bakkt’s latest move, BitLicense’s approval, and the latest alliance have positioned the participating parties as major industry market players.
This alliance is taking place at a time when the total cryptocurrency market capitalization dropped below its initial $2.5 trillion price mark. The sudden drop in market value has been linked to the drop in the price of Bitcoin, which also currently has the biggest market capitalization at the moment.
As at press time, the price of Bitcoin is hovering around $69,000 area, a 0.98% increase after dropping from its initial $71,000 all-time high. The market capitalization is currently $1,369,143,821,884 after being traded for $16,730,203,346 in trading volume.