Bakkt Holdings is facing scrutiny from New York based law firm Bronstein, Gewirtz & Grossman, LLC regarding potential violations of federal securities laws.
The firm says the investigation has been prompted by Bakkt’s recent announcement of delays in filing its 2024 annual financial report and the termination of significant client partnerships.
On March 17, Bakkt disclosed that both Bank of America and Webull Pay LLC would not be renewing their commercial agreements with the company. These partnerships were substantial, with Bank of America accounting for approximately 16% of Bakkt’s loyalty service revenue.
The company’s relationship with Webull is even more significant as Webull’s collaboration with Bakkt allowed Webull’s customers to buy, sell, and manage cryptocurrencies through accounts held with Bakkt.
However, earlier this month Webull notified Bakkt that it would not renew their commercial agreement upon its expiration on June 14, 2025. In a filing with the SEC on March 17th, Bakkt revealed that the Webull relationship accounted for “74% of the Company’s crypto services revenue in both the year ended December 31, 2023 and the nine months ended September 30, 2024.”
Following this news, Bakkt’s stock experienced a significant decline, dropping 35% in after-hours trading to $12.83. At the time of writing, the BKKT share price has fallen to $10.90.
In addition to the loss of key clients, Bakkt announced a delay in filing its annual report for the fiscal year ending December 31, 2024, citing the need for additional time to complete the presentation of its consolidated financial statements.
Frequency of Annual Report Delays Among U.S. Public Companies
While occasional delays in filing annual reports occur among publicly traded companies in the U.S., they are relatively uncommon and often raise concerns among investors and regulators. Such delays can signal underlying financial or operational issues, leading to increased scrutiny and potential volatility in stock performance.
Who are Bronstein, Gewirtz & Grossman, LLC?
Bronstein, Gewirtz & Grossman, LLC is a New York-based law firm specializing in securities fraud class actions and shareholder derivative suits. The firm has a history of representing investors, and is asking Bakkt shareholders who are “aware of any facts relating to this investigation” or have purchased Bakkt securities to contact the firm.
Interestingly, Bronstein, Gewirtz & Grossman has a long history of bringing class actions against crypto related firms, with current actions underway against Robinhood, Coinbase, Nvidia, Block Inc, Bitfarms and others.
