Bakkt Refocuses on Digital Asset Custody: Adds Six New Coins, Plans Further Expansion
Summary:
Bakkt, a cryptocurrency firm, is refocusing on digital asset custody by supporting six additional coins - Bitcoin Cash, Dogecoin, Ethereum Classic, Litecoin, Shiba Inu, and USD Coin - expanding from its current Bitcoin and Ethereum offerings. The company aims to add more coins next year. Bakkt employs multiple security measures, including cold storage and multi-signature technology, to safeguard assets. The latest development follows the company's Q3 report showing a 30% YoY decrease in adjusted EBITDA loss. Bakkt plans to enhance its digital asset custody services through partnerships and refocus its strategy towards B2B clients.
In a recent announcement, Bakkt, a prominent player in the crypto industry, unveiled its intention to revisit its original business line of digital asset custody by adding six new cryptocurrencies to its portfolio as of November 15. Expanding beyond Bitcoin (BTC) and Ethereum (ETH), Bakkt now offers custodial services for Bitcoin Cash (BCH), Dogecoin (DOGE), Ethereum Classic (ETC), Litecoin (LTC), Shiba Inu (SHIB), and USD Coin (USDC). By early next year, the firm plans to introduce even more coins to its services.
The primary objective of digital asset custody is to securely protect cryptographic keys, which are vital for asset access and transfers. Bakkt utilizes a variety of security protocols, such as cold storage and multi-signature technology, to guarantee asset safety.
This news comes in the wake of Bakkt's quarterly earnings report, published on November 14, detailing a 30% year-on-year reduction in an adjusted EBITDA loss (non-GAAP) of $21.6 million due to reduced compensation and benefits costs. The report also revealed that Bakkt's crypto revenue for the third quarter of 2023 reached $191.8 million, largely attributable to the acquisition of Apex Crypto in April. Over the same quarter, the business recorded a total revenue of $204.8 million. Notably, Bakkt reported $505.7 million in terms of assets under custody, representing a 28% decrease from the previous year.
Aiming to bolster its digital asset custody operations, Bakkt is forging new partnerships. The company intends to offer clearing and custodial services for EDX Markets, a crypto exchange with support from Wall Street, initially acting as a backup qualified custodian. Unchained, a Bitcoin platform, and LeboBTC, a crypto consulting firm servicing institutional investors, are among the new clients of Bakkt's custodial services.
Bakkt CEO, Gavin Michael, pointed out how the past year's events have highlighted the need for qualified crypto custody. The company has identified an expansion in its custody services as a key component of its strategy to target business-to-business (B2B) clients. Bakkt announced in February that it would be retiring its consumer-centric app, first launched in 2021, to pivot its focus toward institutions amid a challenging crypto winter.
Old-guard financial institutions are not far behind in recognizing the need for digital asset custody. For instance, BNY Mellon, America's oldest bank, created a digital custody platform last year to protect selected clients' ETH and BTC holdings. Similarly, DZ Bank, Germany's third-largest financial institution, began offering crypto custody services to institutional investors earlier this month.
Published At
11/15/2023 5:30:00 PM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.