Bakkt Holdings is refocusing on digital asset custody as its primary business, announcing support for six new coins in addition to Bitcoin and Ether.
Bakkt has officially relaunched its Bakkt Custody platform, introducing several enhancements and expanding its supported tokens to a total of eight. The relaunch includes the addition of six new tokens, aligning the custodial platform with those available on Bakkt Trading. The supported tokens now include Bitcoin, Ethereum, Bitcoin Cash, Ethereum Classic, Litecoin, Dogecoin, USD Coin, and Shiba Inu.
The redesigned Bakkt Custody platform incorporates advanced features, including segregated on-chain wallet addresses that provide clients with the flexibility to configure security processes within the application. The enhancements also include improved reporting features.
Operated under Bakkt Trust Company LLC, a New York Department of Financial Services (NYDFS)-qualified custodian, Bakkt Custody emphasizes institutional-grade security and reliability. The platform adheres to rigorous security measures, employing techniques such as cold storage and multi-signature technology to ensure the safeguarding of cryptographic keys.
The platform is insured to protect digital assets, subjected to independent third-party testing, and managed with comprehensive security and operational controls outlined in robust security and compliance policies.
Bakkt’s President and CEO, Gavin Michael, underscored the platform’s commitment to qualified crypto custody, emphasizing that the Bakkt Custody platform adheres to institutional standards by never co-mingling funds and prioritizing client security. He also noted that the addition of these assets caters to clients seeking seamless transitions between platforms and reaffirmed Bakkt’s dedication to expanding its offerings securely and in compliance with regulations.
The new token capabilities are set to be integrated into the platform in December 2023, with plans to add more coins to Bakkt’s custodial services in early 2024.
Bakkt Enhances Crypto Custody Platform Amid Regulatory Developments and Reports Q3 2023 Earnings
Bakkt has fortified its Bakkt Custody platform, implementing strategic enhancements to meet the evolving regulatory landscape. In the latest earnings report released on November 14, Bakkt revealed an adjusted EBITDA loss of $21.6 million for Q3 2023, reflecting a 30% YoY decrease primarily attributed to reduced compensation and benefits. However, the report showcased its progress in the custody sector, including signed agreements with LeboBTC Ledger Group (LLG) and Unchained, along with preliminary plans to join EDX Markets’ clearing house and custodial network as a qualified custodian.
In Q3 2023, Bakkt reported crypto revenue of $191.8 million, driven by the Apex Crypto acquisition in April. The total revenue for the quarter amounted to $204.8 million, and assets under custody stood at $505.7 million, marking a 28% decrease from the previous year.
Bakkt’s revamped Custody platform earned industry recognition, receiving the Best Digital Assets Custodian award at the 2023 Digital Asset Awards from The Digital Banker. The award acknowledges its excellence in innovation, transaction capability, risk management, and interoperability in the custodial space.
To further strengthen its position in crypto custody, Bakkt is actively forming partnerships, including plans to provide clearing and custodial services for EDX Markets. The company aims to serve as a qualified backup custodian for the Wall Street-backed crypto exchange.
Notably, traditional financial institutions are also making strides in the digital asset custody domain, with BNY Mellon launching a digital custody platform for ETH and BTC holdings in 2022. Similarly, Germany’s DZ Bank entered the crypto custody space, offering services to institutional investors.