The New York Stock Exchange (NYSE) has issued a warning to cryptocurrency custody and trading platform Bakkt, threatening to delist it if the platform fails to bring its average closing stock price back above $1. In a press release on March 13, Bakkt acknowledged receiving notification from the NYSE, stating that it had fallen short of the exchange's listing requirements due to its stock price averaging below $1 over the past 30-day trading period.
On March 13, Bakkt's closing price stood at 60 cents, reflecting a 2.8% increase for the day but marking a substantial decline of nearly 42% for the month, having slipped from a position above $1. Notably, in late October 2021, Bakkt briefly traded at a price exceeding $40, as indicated by Google Finance. In response to the warning, Bakkt expressed its commitment to rectify the share price deficiencies and regain compliance with NYSE standards. It hinted at the possibility of implementing a reverse stock split, subject to shareholder approval, as a potential measure to boost the stock price.
Bakkt now faces a six-month period to rectify the situation, during which it must ensure that its share price meets the NYSE requirements. The company clarified that if, by the last trading day of any calendar month within this timeframe, its stock price reaches or exceeds $1 and maintains an average of at least $1 over the trading days, it could regain compliance with the exchange's listing regulations. Bakkt is majority-owned by Intercontinental Exchange (ICE), the entity behind the NYSE, which established the cryptocurrency company in 2018 before it went public on the NYSE in October 2021.
Originally positioned as a platform catering to institutional clients for cryptocurrency trading, storage, and spending, Bakkt also launched a retail-oriented app. However, the app failed to gain traction among the competitive landscape of cryptocurrency exchanges and was ultimately discontinued in February 2023. Since its public listing, Bakkt has recorded eight consecutive quarters of net losses, and it recently cautioned in early February about its financial sustainability, indicating potential cash flow challenges in the coming year. To address this, Bakkt obtained regulatory approval on February 14 to issue $150 million in new shares as a means of raising capital.
