The recent market frenzy has been dominated by so-called "hundred-bagger" stocks like DWAC and PHUN, which saw dramatic rises before pulling back significantly this week. Investors who missed those rapid gains or suffered losses are now searching for the next potential high-growth opportunity. Interestingly, one stock, which received early backing from billionaire Li Ka-shing, surged nearly 250% in a single day this week.
Understanding Bakkt’s Meteoric Rise
Bakkt Holdings Inc. (NYSE: BKKT) closed at $9.15 on October 22, with a market capitalization of approximately $2.3 billion. However, news of partnerships with major financial players triggered a dramatic price increase. By midweek, the stock had reached an intraday high of $37.49, representing a gain of over 300% from the previous week’s close.
This surge highlights the extreme volatility and opportunity within emerging financial technology sectors, particularly those involving digital assets.
Li Ka-shing’s Early Involvement
Bakkt was founded in April 2018 and completed its first funding round later that year. Twelve institutional investors participated, raising $182.5 million in total. Notable participants included Horizon Ventures (Li Ka-shing’s private investment arm), Microsoft’s venture capital arm M12, Intercontinental Exchange (ICE), Galaxy Digital, and Pantera Capital.
This early institutional support provided Bakkt with both capital and credibility, positioning it for long-term growth in the digital asset ecosystem.
Core Business: A Digital Asset Platform
Bakkt operates as a digital asset trading platform, offering individuals and institutions various ways to trade, store, and use cryptocurrencies. Founded by Kelly Loeffler and Jeffrey Sprecher, the company aims to build trust and accessibility in cryptocurrency markets.
Initially, the platform only offered bitcoin futures and options contracts. Through strategic acquisitions and internal development, Bakkt has expanded its services to include a consumer-facing wallet, cryptocurrency conversion, and loyalty point redemption.
Earlier this year, Bakkt went public via a SPAC merger with VPC Impact Acquisition Holdings. Leadership has expressed confidence in attracting over 30 million users in the next five years.
Partnership Announcements Fuel Growth
This week’s rally was primarily driven by Bakkt’s partnership announcements with Mastercard and Fiserv. These collaborations are designed to integrate digital assets into mainstream financial services:
- The Mastercard partnership will allow the card network’s partners—including merchants, banks, and fintech companies—to offer cryptocurrency services through Bakkt’s platform. This includes buying, selling, and holding digital assets, as well as issuing crypto-linked credit and debit cards.
- The Fiserv integration will enable easier transfers of digital assets into and out of Bakkt wallets, increasing usability for everyday transactions.
These partnerships are seen as significant steps toward broader cryptocurrency adoption. Coupled with the recent upward momentum in bitcoin’s price, Bakkt is well-positioned to capture increased market interest.
Trading volume remains high following the spike, and the stock showed strong rebound capacity after initial profit-taking. For those considering an investment, however, it is essential to recognize the inherent volatility of emerging asset platforms. Proper risk management is advised.
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Frequently Asked Questions
What does Bakkt do?
Bakkt provides a regulated platform for trading and storing digital assets. It offers cryptocurrency transaction services, digital wallets, and asset security for both retail and institutional clients.
Why did Bakkt stock surge recently?
The stock price increased following announcements of partnerships with Mastercard and Fiserv. These collaborations are expected to expand the use cases and accessibility of cryptocurrencies through existing payment networks.
Is Bakkt a good long-term investment?
While Bakkt has strong backing and promising partnerships, it operates in a highly volatile market. Investors should conduct thorough research and consider their risk tolerance before investing.
Who are Bakkt’s major investors?
Early investors include Horizon Ventures (Li Ka-shing), Intercontinental Exchange, Microsoft’s M12, Pantera Capital, and several other financial institutions and venture funds.
What are the risks of investing in Bakkt?
Key risks include high price volatility, regulatory changes in the cryptocurrency market, competition from other platforms, and the technical challenges associated with scaling digital asset infrastructure.
How does Bakkt make money?
Bakkt generates revenue through transaction fees on trades, custody services, and technology solutions offered to institutional partners and retail users.