Trump expands "crypto business territory" and plans to acquire crypto exchange Bakkt

Donald Trump's media company, Trump Media & Technology Group, is in advanced talks to acquire cryptocurrency exchange Bakkt, with Trump retaining a 53% stake, though financial terms remain undisclosed.
The announcement caused shares of both companies to surge: Trump Media (NASDAQ: DJT) rose over 16%, while Bakkt's stock skyrocketed more than 163% despite extreme volatility.
Bakkt, launched in 2018 by Intercontinental Exchange (ICE), has struggled financially, reporting $328.4M in revenue but a $27.4M operating loss in its latest quarter, though losses have narrowed year-over-year.
The company faced near-delisting earlier this year due to low share prices but avoided it through a reverse stock split. Its crypto custody business, which may be excluded from the deal, is unprofitable.
Trump’s ties to Bakkt include former CEO Kelly Loeffler, who co-chaired his inaugural committee and is married to ICE CEO Jeffrey Sprecher.
Trump’s growing crypto ventures, including the September-launched World Liberty Financial and campaign promises like a Bitcoin reserve, signal his deepening involvement in the industry.
Market enthusiasm around Trump’s crypto-friendly policies has fueled volatility in Trump Media’s stock, despite its weak fundamentals: $2.6M revenue and a $363M net loss in 2024, yet a $7B+ valuation.
Truth Social, Trump’s platform, lags far behind competitors like X (formerly Twitter) with just 646,000 daily visitors compared to X’s 155M.

As he prepares to enter the White House in January 2025, Trump continues to expand into new areas of encryption.

According to the Financial Times, Donald Trump's social media company Trump Media & Technology Group is in advanced negotiations to acquire cryptocurrency trading platform Bakkt.

Trump Media will acquire Bakkt in full, with Trump pledging to retain a 53% stake, according to two people familiar with the negotiations. The valuation and financial terms have not been disclosed.

The news sent shares of both companies soaring.

Trump Media (NASDAQ DJT), which is majority owned by Trump, surged double digits minutes after the report was published. The company, which operates the Truth Social app, closed up more than 16%. Bakkt, which experienced several circuit breakers due to excessive volatility, closed up more than 163%.

The performance was mediocre and it was once on the verge of delisting.

Launched by the Intercontinental Exchange (ICE), Bakkt was founded in 2018 and went public in October 2021. Its main business is to provide technical services to cryptocurrency investors. Before going public through SPAC, Bakkt had raised hundreds of millions of dollars from investors such as Boston Consulting Group, Galaxy Digital, ICE and Microsoft's M12 Venture Fund, but it has been difficult to make a profit. Its latest fiscal quarter report stated that total revenue was US$328.4 million and operating losses were US$27.4 million, a 48% reduction from the losses in the same period last year.

Trump has a special relationship with Bakkt. Kelly Loeffler, former CEO of Bakkt, is the co-chair of Trump’s inaugural committee.

Loeffler's husband is Jeffrey Sprecher, CEO of Intercontinental Exchange. In 2019, Georgia Governor Brian Kemp appointed Loeffler to replace Senator Johnny Isakson, who resigned for health reasons, in the Senate. Loeffler subsequently resigned from his position as a Bakkt executive. However, in the runoff for the special election for the Senate seat, Loeffler was defeated by Democratic Senator Raphael Warnock.

Bakkt has previously said its cryptocurrency custody business, which has regulatory approval from New York authorities, may be shut down. People familiar with TMTG’s negotiations said the business would not be included in the deal. The custody business had an operating loss of $27,000 on revenue of $328,000 in the three months ended Sept. 30.

Bakkt had faced delisting from the New York Stock Exchange due to its depressed share price until it conducted a 25-for-1 reverse stock split in April. Last week, its shares rose 15%.

With the expansion of business territory, is the stock price performance greater than the fundamentals?

The Trump family is accelerating its pace in the cryptocurrency market. Its cryptocurrency project World Liberty Financial, launched in September, and its multiple promises related to digital assets during the campaign (such as establishing a Bitcoin reserve, creating a mining-friendly environment, and replacing the SEC chairman) all show Trump's strong interest in the cryptocurrency industry.

This interest is directly reflected in the market. With Trump's victory in the election, retail investors' expectations for the Republican Party and optimistic expectations that the Trump administration may introduce policies that are favorable to cryptocurrencies have caused the stock price of TMTG, the parent company of Trump's social media platform Truth Social, to fluctuate sharply, rising and falling by billions of dollars on the eve of the election. TMTG has also become one of the most actively traded US stocks. However, TMTG's revenue this year is only $2.6 million, with a net loss of $363 million, but its equity valuation exceeds $7 billion.

Truth Social also has a relatively small user base. According to Similarweb data, the average daily visitor volume to Truth Social this month is 646,000, while Musk's X platform has 155 million daily visitors.