The sudden and staggering surge of Bakkt's stock, which saw an increase of over 50% in a single trading session, caught many by surprise. Without any prior announcements or major positive news, this once-marginalized company became one of the hottest topics across financial and crypto media. What drove this unexpected rally? Was it merely short-term speculation, or a sign of deeper industry shifts?
Understanding Bakkt's Sudden Growth
On May 13, Bakkt's stock price skyrocketed by more than 50% in a short period. The company, often described as a "bridge between traditional finance and the crypto world," had faced challenges such as customer attrition and declining revenue in recent years. This sudden reversal attracted significant market attention.
The immediate trigger was Bakkt's announcement of a $7.7 million net profit in the first quarter, marking its first profitable period in years. However, a deeper look into the financial statements reveals that this profitability stemmed largely from cost-cutting measures and one-time adjustments rather than substantial improvements in its core business operations.
What truly fueled market sentiment was Bakkt's new strategic direction. The company revealed a partnership with DTR, a firm founded by former SoftBank executives, to launch AI plugins and stablecoin payment services. This move positions Bakkt within the growing "PayFi" sector—a fusion of AI-driven agency and on-chain settlement for global payment infrastructure. The combination of AI and cryptocurrency created a compelling new narrative that quickly attracted speculative interest.
Additionally, renewed merger and acquisition speculation played a role. Although previous acquisition talks with Trump Media & Technology Group (TMTG) did not materialize, Intercontinental Exchange (ICE) still holds a majority stake in Bakkt. Market rumors also suggested potential interest from Apex Fintech. With a relatively small float and a high short interest of 23%, these factors contributed to a short squeeze, rapidly driving up the stock price.
Despite the positive market reaction, Bakkt continues to face fundamental challenges. Key client Webull, a Nasdaq-listed brokerage, is set to terminate its partnership with Bakkt in June. This relationship, which provided cryptocurrency trading and custody services, historically contributed over 70% of Bakkt's revenue. Moreover, Bank of America is also ending its collaboration with Bakkt, affecting the loyalty services segment that includes digital rewards and points redemption solutions for enterprise clients.
The loss of these major clients leaves Bakkt's revenue structure more vulnerable. The recent price surge appears to reflect short-term market sentiment rather than a fundamental turnaround.
The Broader Crypto Stock Rally
Bakkt's performance is not an isolated incident. During the same period, numerous crypto-related stocks experienced significant gains. Coinbase rose by nearly 24%, TeraWulf increased by over 10%, and both Amber Group and DMG Blockchain saw gains close to 10%. MicroStrategy also recorded a rise of more than 4%. Overall, the crypto stock sector posted weekly gains of nearly 10%, indicating concentrated investor interest in this niche.
More importantly, the market is beginning to reassess the value of crypto infrastructure. In previous market cycles, investor focus was predominantly on exchanges, platform tokens, and mining companies. Now, attention is shifting toward "pipeline" companies—those providing custody, settlement, compliance, and risk management services. These entities function as essential utilities within the crypto ecosystem, offering more stable revenue models and easier integration into traditional financial valuation frameworks.
Bakkt's surge aligns with this structural shift in investor preference, and it is not the only company benefiting from this trend.
Traditional Finance Embraces Crypto
The true turning point for the crypto industry lies not in short-term stock rallies but in the increasing participation of traditional financial institutions. Around the world, established players are integrating crypto services into their offerings.
In Hong Kong, online brokerages are leading the way. Futu Securities now allows users to deposit and trade major cryptocurrencies like Bitcoin, Ethereum, and USDT directly through their securities accounts. Tiger Brokers has introduced crypto asset deposits, trading, and withdrawals, integrating these with traditional stock trading. Victory Securities has also received regulatory approval to offer crypto-related services.
Globally, payment giants are making even more aggressive moves. Stripe has launched a stablecoin wallet and programmable USDB stablecoin, available in 101 countries. Visa and Mastercard are expanding integrations with partners like Circle to incorporate USDC and other stablecoins into their payment networks. This allows users to spend on-chain assets using traditional cards. PayPal is attracting users with a 3.7% yield on its PYUSD stablecoin, aiming to create a closed-loop stablecoin settlement system.
Even traditional remittance companies like MoneyGram are leveraging stablecoins such as "Ramps" to connect cash-based systems with on-chain assets, covering more than 170 countries.
These developments indicate that traditional finance no longer views cryptocurrency as a threat but is instead actively integrating blockchain technology. This shift is driven by evolving user demands and the pursuit of cost efficiency. Compared to traditional networks with high fees and slow settlement, stablecoins and blockchain offer faster, cheaper, and more transparent infrastructure. Early adopters in this new system are positioning themselves for future influence.
Bakkt's new strategy aligns with this trend. Although it may not match the scale or technological resources of giants like Stripe or Visa, its nationwide licensing, custody capabilities, and清算 infrastructure make it an attractive acquisition target or partnership opportunity. This potential—rather than current profitability—is why the market is revaluing Bakkt.
👉 Explore more strategies on crypto integration
Frequently Asked Questions
What caused Bakkt's stock to surge?
Bakkt's stock rose due to its first quarterly profit announcement, new strategic partnerships in AI and stablecoins, and speculation about potential mergers or acquisitions. Market dynamics like low float and high short interest also contributed to the rapid price increase.
Is Bakkt's growth sustainable?
While the recent surge is impressive, sustainability depends on Bakkt's ability to replace lost revenue from major clients like Webull and Bank of America. Its new initiatives in AI and stablecoins could provide future growth, but execution remains key.
How are traditional financial institutions adopting crypto?
Banks and payment companies are integrating crypto through custody services, trading platforms, and stablecoin products. This includes offering cryptocurrency trading, incorporating blockchain-based settlements, and participating in regulatory sandboxes for digital assets.
What is the PayFi sector?
PayFi refers to payment infrastructure that combines AI automation with on-chain settlement. It aims to create efficient, global payment systems using blockchain technology and smart contracts for faster and cheaper transactions.
Why are crypto infrastructure stocks gaining attention?
Investors are recognizing the value of companies providing essential services like custody, compliance, and settlement. These firms often have more predictable revenue models and are easier to evaluate within traditional financial frameworks.
What risks do crypto stocks face?
Regulatory uncertainty, market volatility, and technological challenges are significant risks. Companies must also navigate client concentration issues and rapidly changing competitive landscapes.
Conclusion
Bakkt's dramatic price surge is a microcosm of broader changes occurring within the crypto and financial industries. As capital markets reassess the value of crypto infrastructure and traditional institutions increasingly adopt blockchain technology, we are witnessing the early stages of a major transition.
This shift rewards those building practical solutions—bridges between traditional and digital finance—rather than those relying on hype. The future will belong to organizations that successfully integrate crypto into mainstream financial systems, providing reliable and efficient infrastructure for the next era of global finance.