Bakkt Holdings, Inc., a prominent player in the cryptocurrency market, received a notification from the New York Stock Exchange (NYSE) on March 14, 2024, regarding non-compliance with the exchange’s minimum share price rule. The NYSE Listed Company Manual’s Section 802.01C mandates that the average closing price of a company’s common stock must remain above $1.00 per share over a consecutive 30-day trading period. Bakkt’s stock failed to meet this requirement, with its average share price falling below the threshold.

The notice from NYSE, however, does not trigger the immediate delisting of Bakkt’s common stock. Instead, it starts the clock on a six-month period during which Bakkt can regain compliance. The stock is considered compliant if, on the last trading day of each calendar month during this period, its closing price exceeds $1.00 and, on average, stays at $1.00 for the 30 trading days ending on that day.

Bakkt has expressed its intention to address the deficiency, with several options on the table, including a reverse stock split, pending shareholder approval. Without changing the market capitalization of the firm, a reverse stock split lowers the number of shares in circulation, which increases the share price.

This situation underscores the volatility and regulatory challenges faced by companies in the crypto space. Bakkt’s forward-looking statements indicate a determination to overcome these hurdles, but they also acknowledge the company’s many challenges, including maintaining its listing on the NYSE amidst a rapidly evolving technological and regulatory landscape.

Founded in 2018, Bakkt offers institutional-grade custody, trading, and onramp capabilities for cryptocurrency, positioning itself as a leader in supporting long-term crypto economy engagement. While headquartered in Alpharetta, GA, Bakkt’s influence extends globally, as it provides solutions tailored to the burgeoning digital asset market.

The broader implications of Bakkt’s current predicament reflect the ongoing maturation of the crypto industry, which continues to adapt to traditional financial markets’ frameworks and compliance requirements. As such, Bakkt’s journey toward resolving its compliance issues could serve as a valuable case study for other firms operating within this dynamic sector.

As of the date of this press release, Bakkt’s leadership remains committed to returning the company to full compliance with NYSE standards and continues to explore all available alternatives to resolve the share price issue. Investors and stakeholders are advised to monitor the situation closely, as the company’s efforts to remedy the non-compliance could have significant implications for its future operations and the broader crypto market.

Investors and regulators will be watching Bakkt’s every move to see how the company handles this obstacle; it will provide insight into how crypto-focused enterprises handle regulatory demands and market swings.