Bakkt Goes Big: $1 Billion Raise Targets Bitcoin Boom in Bold Crypto Power Play
Wall Street's favorite crypto custodian just loaded its war chest—and Bitcoin's in the crosshairs.
Bakkt Holdings dropped an S-3 bombshell today, signaling a $1 billion capital raise that could turbocharge its Bitcoin ambitions. The move comes as institutional FOMO reaches fever pitch, with crypto's institutional adoption curve looking suspiciously like a hockey stick (or a bubble chart, depending who you ask).
The filing reads like a crypto bull's shopping list: "We may use the net proceeds...for acquiring bitcoin." Translation? When the suits start stacking sats, you know we've entered a new phase of the digital gold rush.
Timing's everything—this lands just as Bitcoin flirts with new institutional adoption highs while traditional finance still can't decide if crypto's the future or a Ponzi scheme. Classic Wall Street: always late to the party but first in line for the profits.
How Bakkt’s $1 Billion Raise Could Lead to a Bitcoin Investment
The shelf registration was filed on June 26. For context, a shelf offering is a securities offering where a company registers many securities with the SEC in advance but does not immediately sell all of them.
Instead, the company can “shelf” (or hold) the securities for future sale when market conditions are favorable or the company needs capital. Bakkt Holdings’ filing allows it to raise up to $1 billion through a combination of Class A common stock, preferred stock, debt securities, warrants, or units in one or more future offerings.
“The aggregate offering price of the securities we sell pursuant to this prospectus will not exceed $1,000,000,000. Each time securities are offered with this prospectus, we will provide a prospectus supplement that will describe the specific amounts, prices, and terms of the securities being offered and the net proceeds we expect to receive from that sale,” the S-3 reads.
Notably, earlier this month, Bakkt’s Board of Directors approved a revised corporate investment policy, allowing the company to invest in bitcoin and other digital assets as part of its broader treasury and strategic plans. However, the company has yet to buy Bitcoin or any other digital asset.
“We may acquire Bitcoin or other digital assets using excess cash, proceeds from future equity or debt financings, or other capital sources,” the filing stated.
The firm also mentioned that to finance its Bitcoin and digital asset purchases, it plans to explore other financing options. These include issuing convertible notes, bonds, or debt instruments.
Meanwhile, the S-3 highlighted Bakkt’s ongoing financial challenges, raising concerns about the company’s long-term sustainability.
“We have limited operating history and a history of operating losses. A large percentage of our revenue is concentrated with a single client that has notified us it will not be renewing its agreement with us. The loss of this client will materially and adversely affect our business, financial condition, results of operations and future prospects,” the firm added.
Despite these concerns, the announcement sparked a positive market reaction. According to Google Finance data, BKKT appreciated 3.09% to close at $13.3. Nevertheless, in after-hours trading, the share prices slightly declined by 0.60%.
This uptick comes amid a broader downtrend. Over the past year, BKKT has dipped 35.6%. If Bakkt Holdings proceeds with allocating capital to Bitcoin, it will join a growing list of firms that have adopted a similar strategy.
As a result, many of these companies have seen positive effects on their stock prices.
“Metaplanet’s stock has soared 7,963% since it announced its BTC purchase on April 8, 2024,” Lookonchain wrote.
The blockchain analytics firm also revealed that, of the 20 publicly traded companies that have announced Bitcoin purchases, 8 have seen their stock prices increase. Nevertheless, 12 have experienced declines.
