President-elect Donald Trump’s media group, Trump Media and Technology Group (TMTG), is reportedly in advanced discussions to acquire Bakkt, the cryptocurrency trading platform owned by Intercontinental Exchange (ICE), the Financial Times reported on the 18th. november.
According to the report, the agreement would involve a purchase of all shareswhich represents TMTG’s decision to diversify its operations and enter the booming crypto market.
The news sent Bakkt’s stock price up about 165% to $29 at press time, based on CryptoSlate data.
TMTG is the parent company of Truth Social and has become one of the most volatile and actively traded stocks since Trump’s election victory. Despite only generating $2.6 million in revenue this year, TMTG has a valuation of $6 billion.
Sources close to the discussions told the FT that Bakkt’s cryptocurrency custody business was excluded from the proposed deal because it has struggled to gain traction and is expected to be liquidated.
By acquiring Bakkt, TMTG would gain access to a platform aimed at institutional investors, a market segment Bakkt targets with its planned trading infrastructure.
If finalized, the deal would also expand Trump’s growing involvement in the crypto industry, complementing his recently promoted crypto venture, stablecoin-focused lending platform World Liberty Financial.
ICE and Bakkt declined to comment on the matter and TMTG did not immediately respond to requests for comment.
Bakkt’s struggles
Bakkt, founded by ICE in 2018, has faced persistent challenges in achieving profitability.
Its crypto custody business, which holds cryptos such as Bitcoin (BTC) and Ethereum (ETH) for its clients, reported minimal revenue of $328,000 and operating losses of $27,000 in the third quarter of 2023.
Additionally, the company narrowly avoided being delisted from the New York Stock Exchange earlier this year thanks to a 1-for-25 reverse stock split.
Despite its challenges, Bakkt’s institutional focus and ties to ICE, the owner of the New York Stock Exchange, could offer strategic value to TMTG. Bakkt’s first CEO, Kelly Loeffler, is a close ally of Trump and co-chair of his inauguration committee.
