- Bakkt Holdings Inc. (BKKT) shares fell 31.80% to $8.75 in after-hours trading on Monday after announcing a delay in its financial statement audit, targeting a Form 10-K filing within the 15-day Rule 12b-25 extension.
- Bank of America (BAC) will end its agreement with Bakkt on April 22, 2025, impacting 16% of 2023 and 17% of nine-month 2024 loyalty revenue, with a 12-month transition period required.
- Webull Pay LLC’s non-renewal, expiring June 14, 2025, cuts off 74% of Bakkt’s crypto revenue for both 2023 and nine-month 2024, amplifying the company’s revenue and stability concerns.
Bakkt Holdings Inc. (BKKT) finds itself in a precarious position as its stock plummeted 31.80% to $8.75 in after-hours trading on Monday, reflecting investor unease over a confluence of operational and financial setbacks. The crypto exchange and custody firm disclosed in a filing with the SEC that it requires additional time to finalize its consolidated financial statements, signaling delays in its independent audit process. This stumble in financial reporting, with the company aiming to file its Form 10-K within the 15-day grace period allowed under Rule 12b-25, underscores the complexity of its operations as it juggles crypto and loyalty services in a rapidly evolving digital asset landscape.
Compounding the pressure, Bakkt revealed the termination of two critical commercial agreements, starting with Bank of America (BAC), which accounted for 16% of its loyalty services revenue in 2023 and 17% for the nine months ended September 30, 2024. The agreement, set to expire on April 22, 2025, includes a 12-month transition period during which Bakkt must maintain services, a commitment that could strain resources as it navigates this loss. Similarly, Webull Pay LLC, a dominant player representing 74% of Bakkt’s crypto services revenue for both 2023 and the same nine-month period in 2024, will let its agreement lapse on June 14, 2025. These expirations strip away substantial revenue streams, with Webull’s outsized contribution to the crypto segment highlighting Bakkt’s heavy reliance on a single partner in a volatile market.
The dual blows of delayed financials and lost partnerships paint a challenging picture for Bakkt, a company launched in 2018 by Intercontinental Exchange with ambitions to bridge traditional finance and cryptocurrencies. The stock’s 31.80% after-hours drop to $8.75 reflects a swift market reaction to the uncertainty, especially as the company works to complete its audit and supporting documentation. Losing Bank of America’s 16-17% loyalty revenue and Webull’s 74% crypto revenue – key pillars of its business model – forces Bakkt to confront questions about diversification and resilience. As it approaches the April 22 and June 14, 2025 deadlines, the firm’s ability to pivot and secure new revenue sources will be critical, with the coming months testing its capacity to stabilize in a sector where trust and execution are paramount.
WallStreetPit does not provide investment advice. All rights reserved.
Leave a Reply