NYSE warns Bakkt of potential delisting over low share price
NYSE warns Bakkt of potential delisting over low share price
- The NYSE has notified Bakkt of potential delisting due to its share price falling below $1 over a consecutive 30-day period as of March 12, 2024.
- Bakkt is considering a reverse stock split to remedy its stock price deficiency and comply with NYSE standards, with a six-month period to achieve compliance.
- Despite previous high trading prices, Bakkt has faced eight consecutive quarters of net losses and warned of potential cash shortages for future operations.
The New York Stock Exchange (NYSE) has informed Bakkt, a cryptocurrency custody and trading platform, of a potential delisting due to its share price falling below the required minimum.
According to a press release from Bakkt, the NYSE highlighted that the company’s average closing price of its Class A Common Stock was below $1.00 over a consecutive 30-day trading period as of March 12, 2024. This notification points to a violation of Section 802.01C of the NYSE Listed Company Manual. On the day of the announcement, Bakkt’s shares were trading at $0.5978, representing a significant drop from its October 2021 high of $40 per share.
About Bakkt
Bakkt, established by the Intercontinental Exchange (ICE), which also owns the NYSE, began its operations in 2019. The platform was envisioned as a bridge between traditional finance and cryptocurrency exchanges, offering institutional investors services for the custody and trading of bitcoin. However, despite attempts to expand into the retail market, such efforts were eventually discontinued in the previous year.
In light of the delisting warning, Bakkt has indicated its plans to remedy the stock price shortfall and regain compliance with NYSE regulations. Among the considered strategies is a reverse stock split, pending approval from shareholders, which aims to increase the stock price to meet the NYSE’s standards. The company has a six-month period to adjust its share price to comply with exchange requirements.
Bakkt’s approach involves achieving a $1 share price on the final trading day of any calendar month within this six-month window, alongside maintaining an average share price of at least $1 over the 30 trading days ending on that day.
The announcement comes after Bakkt reported eight consecutive quarters of net losses since its listing on the NYSE in October 2021. Additionally, in early February, Bakkt issued a warning about its cash reserves, suggesting they might be insufficient for sustaining business operations over the next 12 months. The firm also received regulatory approval to offer $150 million in new shares to raise necessary funds.
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Damilola Lawrence
Damilola Lawrence has covered news on crypto markets and tech for over 5 years. He has previously shared crypto insights and analysis for TheShibMagazine, CryptoMode, Qweens Magazine, and The Recording Academy before pivoting into Web3. At Cryptopolitan, he is a crypto price prediction specialist. After finishing a bachelor’s degree, he has segued into a master’s degree in IT Cybersecurity at Maria Curie-Skłodowska University.
