Market Movers: Trump’s Truth Social Eyes Crypto Exchange Acquisition
In a surprise move, Trump Media & Technology Group (DJT) saw its stock soar over 16% on Monday, following a report from the Financial Times that the company is in advanced talks to acquire crypto exchange Bakkt (BKKT). The news sent Bakkt’s stock skyrocketing, with a staggering 162% gain.
The Players Involved
DJT, which operates the social network Truth Social, boasts a market cap of around $7.1 billion, with President-elect Donald Trump holding a roughly 60% interest in the company. Meanwhile, Bakkt is majority-owned by NYSE parent company Intercontinental Exchange (ICE), led by CEO Jeff Sprecher, who is married to former Georgia Sen. Kelly Loeffler, co-chair of Trump’s inaugural committee.
A Crypto-Friendly Administration
Trump’s election win has been credited with pushing bitcoin prices to all-time highs, as his administration is viewed as more supportive of the alternative asset class. In July, Trump attended a bitcoin conference in Nashville, where he pledged to introduce more supportive regulation and appoint a crypto Presidential Advisory Council. He also vowed to fire current SEC Chair Gary Gensler.
Bitcoin Surges
On Monday, bitcoin (BTC-USD) rose over 2% to trade just below $92,000 a token. The surge was felt across the crypto market, with other crypto-adjacent names like MicroStrategy (MSTR) and Coinbase (COIN) seeing significant gains. MicroStrategy, which owns nearly 280,000 bitcoins, closed almost 13% higher after announcing the purchase of an additional 51,780 bitcoins for $4.6 billion.
Coinbase CEO to Meet with Trump
Meanwhile, Coinbase (COIN) stock jumped over 6% on Monday, following a report from the Wall Street Journal that its CEO, Brian Armstrong, was set to meet with Trump. The meeting has sparked speculation about potential collaborations between the two parties.
Bakkt’s Struggles
Bakkt, which has a market cap of around $190 million, has seen its stock fall sharply since going public in 2021. The company’s struggles have been well-documented, but a potential acquisition by DJT could provide a much-needed boost.
Truth Social’s Fundamentals Questioned
As Truth Social attempts to take on social media incumbents, the fundamentals of the company have long been in question. On Nov. 5, DJT dropped third-quarter results that revealed a net loss of $19.25 million for the quarter ending Sept. 30. Despite this, the company held about $370 million in cash at the end of the quarter, and its stock is up 10% over the last month.
What’s Next?
As the crypto market continues to evolve, one thing is clear: Trump’s influence is being felt. With his administration viewed as more supportive of the alternative asset class, it will be interesting to see how this acquisition plays out and what it means for the future of crypto.
Leave a Reply