Trump Media & Technology Group (TMTG), the company behind former President Donald Trump’s social media platform Truth Social, is reportedly in advanced negotiations to acquire cryptocurrency exchange Bakkt. This potential deal marks a significant move for TMTG as it seeks to expand its presence in the digital asset space.
Market Reaction
The news of the potential acquisition had a dramatic impact on the stock market:
- TMTG’s stock (DJT) surged by over 16% following the report.
- Bakkt’s shares (BKKT) skyrocketed by an astonishing 162%, leading to multiple trading halts due to volatility.
This market reaction underscores the significance of the potential deal and investors’ enthusiasm for Trump-related ventures in the cryptocurrency sector.
Deal Structure and Valuation
While specific details of the deal remain undisclosed, sources familiar with the matter indicate that TMTG is pursuing an all-stock acquisition of Bakkt.
As of the latest reports, Bakkt’s market capitalization stands at approximately $150-190 million.
Key Players and Connections
The potential acquisition involves several notable figures and entities:
- Intercontinental Exchange (ICE), which owns the New York Stock Exchange, currently holds a 55% stake in Bakkt.
- Kelly Loeffler, former CEO of Bakkt and ex-Georgia Senator, now serves as co-chair of Trump’s inaugural committee.
- Jeffrey Sprecher, CEO of ICE, is married to Kelly Loeffler.
These connections highlight the intertwining of political and financial interests in this potential deal.
Implications for Trump and the Crypto Industry
This move represents a significant expansion of Trump’s involvement in the cryptocurrency sector:
- It follows Trump’s recent launch of World Liberty Financial, another crypto venture.
- The acquisition could leverage Trump’s growing influence in the digital asset space.
- Bitcoin prices have surged since Trump’s election victory, with expectations of a more crypto-friendly regulatory environment.
Financial Context
Both TMTG and Bakkt have faced financial challenges:
- TMTG reported a net loss of $25 million in Q3 2024, with revenues of just $1.01 million.
- Bakkt issued a “going concern” warning earlier this year, indicating uncertainty about its ability to continue operations.
Despite these challenges, TMTG’s market capitalization stands at approximately $7.1 billion, with Trump holding a 60% stake.
Broader Impact
This potential acquisition could have far-reaching implications for the cryptocurrency market, potentially influencing mainstream adoption and regulatory landscapes.
It also represents a strategic move by TMTG to diversify beyond social media and into the rapidly evolving world of digital assets.As negotiations continue, the financial world watches closely to see how this deal might reshape the intersection of media, politics, and cryptocurrency.
