What is Growth Strategy and Future Prospects of Bakkt Company?

In July 2025, Bakkt finalized the sale of its Loyalty business for $11 million. This move, following the earlier divestiture of its custody business to Intercontinental Exchange (ICE) in May 2025, allows Bakkt to dedicate its resources to its core cryptocurrency and stablecoin payment infrastructure.

Significant technology upgrades are underway for Bakkt's 'Brokerage-in-a-box 2.0' solution, scheduled for the latter half of 2025. This enhanced platform will support over 200 digital assets and incorporate advanced features like social trading and yield generation.

Bakkt is actively expanding its client base, securing new retail and institutional clients, including prominent Bitcoin ETF providers and various fintech companies. This broadens its reach within the digital asset ecosystem.

The company is pursuing international expansion, with a particular focus on Latin America and Asia, where its crypto capabilities are already operational. This global strategy is a key component of Bakkt's growth strategy.

For the entirety of 2024, Bakkt posted total revenues of $3,490.2 million. This growth was largely propelled by its crypto services. The notional crypto traded volume saw a significant surge of 204.2% year-over-year, reaching $3,446.6 million. Assets under custody also experienced substantial growth, increasing by 228.1% to $2,301.9 million.

Despite robust revenue increases, Bakkt recorded a net loss of $103 million for 2024, which represented a 54.2% improvement from the previous year. The company also managed to reduce its Adjusted EBITDA loss by 31.6% year-over-year, signaling improved operational efficiency.

In the first quarter of 2025, Bakkt reported total revenues of $12.6 million, a decrease from the previous quarter, partly due to a significant client not renewing its contract. This client had previously accounted for a substantial portion of Bakkt's crypto revenues.

However, Q1 2025 marked a significant turnaround in profitability, with a net income of $16.2 million, a 176.5% year-over-year improvement. Operating expenses, excluding crypto-related costs, were reduced by 36.3%. The notional crypto traded volume in Q1 2025 increased by 23% year-over-year to $1,060 million.

For the second quarter of 2025, Bakkt projected total revenues of $577.9 million, a 13.3% increase year-over-year. Net loyalty revenues were estimated to be between $9 million and $10 million. The company's adjusted EBITDA loss narrowed to $12.6 million, a 29.9% improvement, and its GAAP net loss was $30.2 million, a 15.1% reduction.

To bolster its financial position, Bakkt secured $23.8 million through a convertible debenture issuance and an additional $75 million from a stock and warrant offering in July 2025. As of June 30, 2025, the company had an estimated $60 million to $62 million in cash and cash equivalents, with access to $40 million in undrawn liquidity. Bakkt's strategy for achieving profitability centers on expanding its client network, diversifying its product offerings, and maintaining disciplined expense management.

Bakkt's internal restructuring, including a 20% workforce reduction in 2024, is a direct response to operational challenges. The planned divestment of Loyalty and Custody divisions signals a strategic pivot towards core crypto infrastructure.

Despite cost-saving measures and strategic realignments, the company continues to report GAAP losses. The volatility in revenue and the significant operational risks suggest that achieving sustained profitability will require substantial strategic execution.

The securities class action lawsuit highlights concerns about past investor communications regarding revenue stability and client dependencies. This legal challenge, coupled with stock compliance issues, creates a complex environment for investor relations and future capital raising.

The auditor's 'significant doubt' regarding Bakkt's ability to continue as a going concern, stemming from inadequate cash reserves and operational challenges, underscores the critical nature of its upcoming strategic moves for long-term survival.