Trump Media Eyes Bakkt in Bold Crypto Expansion Amid Market Volatility
Trump Media & Technology Group (TMTG) is reportedly in "advanced talks" to acquire cryptocurrency trading platform Bakkt, according to the Financial Times. This potential move signals a significant expansion into the crypto space by the company, which is majority-owned by President-elect Donald Trump.
Market Reactions and Soaring Stocks
The news ignited a frenzy on Wall Street. Trump Media, which operates the Truth Social app and trades as DJT on Nasdaq, saw its shares surge over 16% by market close. Meanwhile, Bakkt’s stock skyrocketed by an astonishing 162%, triggering multiple trading halts due to extreme volatility.
A Strategic Alliance with Familiar Faces
Bakkt, originally founded in 2018 by Intercontinental Exchange (ICE), has ties to Trump’s circle. Kelly Loeffler, Bakkt’s former CEO and co-chair of Trump’s 2017 inauguration committee, was pivotal in the company's early days. Loeffler, who later served as a U.S. Senator, is married to ICE CEO Jeffrey Sprecher, connecting the crypto firm to powerful figures in finance and politics.
Trump Media's Financial Rollercoaster
Despite reporting a staggering $363 million net loss on just $2.6 million in revenue this year, Trump Media’s market value remains robust, exceeding $7 billion. The company's Q3 earnings highlighted $673 million in cash reserves, positioning it for ambitious ventures like the Bakkt acquisition.
Bakkt’s Rocky Journey
For Bakkt, this potential acquisition comes at a critical juncture. The company recently faced delisting warnings from the New York Stock Exchange due to prolonged low share prices, prompting a 1-for-25 reverse stock split in April. Despite these challenges, Bakkt reported $328.4 million in revenue last quarter, alongside a narrowing operating loss.
Trump’s Crypto Ambitions
The deal also underscores Trump’s increasing interest in cryptocurrencies. Weeks before the 2024 election, he promoted a token linked to World Liberty Financial, a venture poised to deliver 75% of its net revenue to Trump and his family.
Looking Ahead
If finalized, the Bakkt acquisition could bolster Trump Media’s foray into the crypto sector while addressing Bakkt’s financial uncertainties. As Trump prepares for his return to the White House in January 2025, the deal may mark a turning point in the convergence of politics, media, and cryptocurrency.