Bakkt Warns of Financial Struggle; Plans to Raise Capital With Public Securities
Summary:
Bakkt, a cryptocurrency company backed by Intercontinental Exchange (ICE), has warned that it might not have sufficient funding to continue operations for the next 12 months. In an amendment filed to its quarterly report with the Securities and Exchange Commission, Bakkt highlights the significant risks associated with expansion into new markets and the swift changes within the crypto-assets industry. The firm may have to raise revenues significantly or secure additional funds to sustain operations. Now, Bakkt is planning to raise extra capital by trading up to $150 million in publicly registered securities.
Bakkt, a cryptocurrency enterprise supported by the Intercontinental Exchange (ICE) and brought to life amid high excitement in 2019— has recently alerted it might not possess sufficient funds to sustain its operations in the forthcoming 12 months. On February 7, Bakkt made a revision to its quarterly statement lodged with the Securities and Exchange Commission, with a section on risk elements stating a caution that the firm's continuity could be at risk. Bakkt clarified that it no longer perceives its available and restricted funds as adequate to maintain its workings in the subsequent 12 months. “Our push into new markets and augmenting our revenue foundation is significantly uncertain due to the swift changes within the crypto assets industry.” The company emerged in 2018, propelled by the numerous interest from the Intercontinental Exchange, the proprietor of the NYSE. During its inception, Bakkt was seen as Bitcoin's gateway to the institutional investor domain in a deepening bearish market. However, the latest filing indicates the firm may struggle to sustain without considerably boosting revenue or securing new funds. The firm is unsure of its likeliness to substantially hike revenues beyond what they've previously achieved, thus generating a sustainable operational profit and ample cash flow, without seeking further capital shortly. Bakkt revealed it is planning to raise extra capital by selling up to $150 million in publicly registered securities to support its long-term goals. The firm filed an updated Form S-3, upon being effective, will permit Bakkt to trade up to $150 million of public securities to gather additional funds. We'll continue to follow this developing story, updating further information as and when discovered.
Published At
2/8/2024 6:06:28 AM
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