Cryptocurrency storage and trading platform Bakkt has received a warning from the New York Stock Exchange (NYSE) that it does not comply with the exchange’s listing rules.
According to the NYSE, the platform faces the risk of delisting after failing to maintain a closing price above $1 in the past 30 days.
Bakkt plans to solve this problem
Last Wednesday, Bakkt notified the NYSE of its intention to resolve the stock price discrepancy and comply with required listing standards. Companies now have six months to raise their stock prices to meet the minimum standards.
The rules require Bakkt to notify the NYSE if it plans to resolve the matter through actions that require shareholder approval. A violation will be resolved if the stock price rises above $1.00 per share and remains at that level for 30 consecutive trading days.
Bakkt said it plans to explore all possible options to resolve the matter, including a potential reverse stock split subject to shareholder approval.
Meanwhile, Bakkt recorded a net loss for eight consecutive quarters. The company warned about its financial sustainability in early February, expressing concerns that it had insufficient cash reserves to sustain operations over the next 12 months.
In a February Securities and Exchange Commission (SEC) filing, Bakkt acknowledged challenges and uncertainty surrounding its ability to operate next year. The cryptocurrency platform thus obtained regulatory approval on February 14 to offer $150 million in new shares to raise capital to address its financial woes.
Bakktâs market challenges
NYSE’s parent company, Intercontinental Exchange (ICE), founded Bakkt in 2018 and holds a majority stake in the cryptocurrency company. Bakkt debuted on the NYSE in October 2021.
At launch, the company positioned itself as a platform for institutional clients to trade, store, and spend cryptocurrency. Initially, we also introduced applications for retail stores. However, the retail app was discontinued in February 2023 due to low adoption due to stiff competition from other cryptocurrency exchanges.
The company’s founding CEO, Kelly Loeffler, served as a U.S. senator from Georgia for just one year, from 2020 to 2021.
Bakkt’s stock price closed at $0.5978 on Wednesday, bringing its market capitalization to about $80 million. This figure represents a significant decline from October 2021, when the stock was valued at $40 per share.
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