Bakkt Plans $1 Billion Offering to Buy Bitcoin

Bakkt Holdings Inc. has revealed plans to raise $1 billion through a mixed securities offering, with intentions to use a portion of the proceeds to purchase Bitcoin. The crypto software firm filed with the U.S. Securities and Exchange Commission on June 26, detailing an offering that could encompass Class A common stock, preferred stock, debt securities, warrants, or units. This Form S-3 shelf registration allows Bakkt to issue these securities in one or more tranches over time, contingent on market conditions.

Bakkt's updated investment policy now allows for the acquisition of Bitcoin or other digital assets using excess cash, proceeds from future equity or debt financings, or other capital sources. The firm noted that the timing and scale of any crypto asset acquisition will be determined by business performance, market conditions, capital availability, and strategic priorities. Bakkt is exploring various financing options, including convertible notes or bonds, to support these plans.

This strategic shift towards a Bitcoin treasury strategy aligns Bakkt with a growing trend among corporates and public entities that are allocating reserves into digital assets. This move may be an attempt to revitalize investor confidence and strengthen the firm’s long-term positioning in the crypto sector. Bakkt, established in 2018, offers crypto trading and custody solutions through APIs and embedded platforms and went public in 2021 via a SPAC merger.

The firm has encountered significant challenges recently, including a 30% drop in shares in March after two of its largest clients, decided not to renew their commercial agreements. Additionally, Bakkt reported heavy losses and expressed concerns over its ability to continue operations without fresh capital. Despite these setbacks, the latest development signals Bakkt's commitment to leveraging digital assets as part of its broader treasury strategy.