President-elect Donald Trump's social media company is reportedly in talks to acquire cryptocurrency company Bakkt.
Trump Media & Technology Group is nearing an all-stock acquisition of a cryptocurrency trading platform previously led by former Georgia Sen. Kelly Loeffler, an ardent supporter of President Trump. The Financial Times reported The announcement was made Monday based on two people familiar with the talks.
The valuation of the transaction is unclear. Bakkt's market capitalization as of Monday was more than $150 million.
Loeffler served as a senator from Georgia from the end of the Trump administration until 2021. While running for re-election, her campaign ads boasted about her. “President Trump's voting record is 100%.” She opposes DEI initiatives and supports photo ID voting requirements.
Prior to becoming Bakkt's first chief executive officer, he was a marketing executive at the New York Stock Exchange and Intercontinental Exchange, which owned 55% of Bakkt.
Loeffler was selected by President Trump to co-chair the inaugural committee. Her husband, Jeff Sprecher, is the founder and CEO of ICE.
Bakkt shares soared more than 162% on Monday following news of the deal, and rose another 3.3% on Tuesday. TMTG stock rose more than 16%, but was down about 9% on Tuesday.
TMTG did not immediately respond to a request for comment.
in Statement on websiteBakkt said it does not comment on “market rumors or speculation.”
The acquisition marks President Trump's latest move into the world of cryptocurrencies, after he pitched himself as a pro-crypto candidate during the campaign.
Shares of bitcoin and crypto companies soared after Trump's victory, as investors hoped he would ease industry regulations once he returns to the White House.
Since going public in 2021, Bakkt has struggled to turn a profit and boost its stock price.
Bakkt's crypto custody business is particularly struggling. The Financial Times said it made an operating loss of $27,000 on revenue of $328,000 in the three months to September 30.
Sources told the Financial Times that the crypto custody arm will likely be scaled back and will not be included in the deal.
TMTG, which owns the social media platform Truth Social, has seen high trading volatility during the presidential election.
The stock was temporarily suspended several times in the run-up to Election Day as investors used it as a prediction market for Trump's victory.
Stocks soared when Trump's odds looked good, but fell after a strong day for Vice President Kamala Harris.
Trump, who is a major shareholder in TMTG, said he has no intention of selling his stake, despite the unpredictable nature of the stock's trading.
Like Bakkt, his company has struggled to turn a profit. Earlier this month, TMTG posted a net loss of $19 million for the period ended Sept. 30, on revenue of about $1 million. Due to stock market performance, TMTG's market capitalization reached approximately $6 billion.
Truth Social has struggled to match the user base of other platforms, such as Elon Musk's X. As of May, Truth Social had about 76,000 daily active users in the U.S., according to data from SimilarWeb. CNBC reported.
Meanwhile, X has about 100 million users in the United States, according to research firm Exploding Topics.
