President-elect Donald Trump’s social media company is in advanced talks to buy cryptocurrency firm Bakkt, according to a report.
Trump Media & Technology Group is nearing an all-share purchase of the crypto trading platform, which was previously led by former US Sen. Kelly Loeffler of Georgia, a vocal Trump supporter, the Financial Times reported on Monday based on two people with knowledge of the talks.
The valuation of the deal is unclear. Bakkt had a market capitalization of more than $150 million on Monday.
Loeffler served as a United States senator from Georgia at the tail-end of Trump’s first administration through 2021. While running for re-election, her campaign ads bragged about her “100% Trump voting record.” She has spoken out against DEI initiatives and in favor of photo ID voting requirements.
Prior to serving as Bakkt’s first chief executive, she was a marketing exec at Intercontinental Exchange — which owns the New York Stock Exchange and 55% of Bakkt.
Loeffler has been chosen by Trump to co-chair his inaugural committee. Her husband, Jeff Sprecher, is ICE’s founder and chief executive.
Bakkt shares shot up more than 162% on Monday on reports of the deal, and inched up another 3.3% on Tuesday. TMTG shares rose more than 16%, then on Tuesday fell about 9%.
TMTG did not immediately respond to requests for comment.
In a statement on its website, Bakkt said it does not comment on “market rumors or speculation.”
The acquisition would represent Trump’s latest move into the world of cryptocurrency after he staked his claim as the pro-crypto candidate during his campaign.
Bitcoin and crypto firm stocks soared after Trump’s win as investors hope he will relax industry regulations upon his return to the White House.
Bakkt has struggled to turn profits and boost its share price since it went public in 2021.
Bakkt’s crypto custody business, in particular, has struggled. It made operating losses of $27,000 from revenue of $328,000 in the three months ended Sep. 30, according to the Financial Times.
The crypto custody division is likely to be tapered down and will not be included in the deal, sources told the Financial Times.
TMTG, which owns social media platform Truth Social, experienced high trading volatility throughout the president-elect’s campaign.
It was temporarily halted a handful of times ahead of Election Day as investors used the stock as a prediction market for a Trump win.
Shares shot up when Trump’s odds looked good, and fell back down after a good day for Vice President Kamala Harris.
Trump, TMTG’s majority stakeholder, said he would not sell his shares despite the stock’s unpredictable trading.
His company, like Bakkt, has struggled to turn a profit. Earlier this month, TMTG posted a $19 million net loss in the period ended Sep. 30 and about $1 million in revenue. Its stock market performance has pushed TMTG’s market capitalization to around $6 billion.
Truth Social has struggled to rival other platforms’ user bases, like Elon Musk’s X. As of May, Truth Social had around 76,000 daily active users in the US, according to SimilarWeb data reported by CNBC.
X, meanwhile, has around 100 million users in the US, according to research firm Exploding Topics.
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