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Bakkt Holdings said in a press release on Feb. 8 that it is “confident” it will continue operating despite expressing concerns earlier over its liquidity in a regulatory filing.

Bakkt wrote that “management remains confident” and intends to continue serving clients and moving toward profitability. The exchange added that its filing with the SEC for the quarter ending September 2023 described various risk factors in part related to its acquisition of Apex Crypto, which concluded in early 2023.

Bakkt said that its Feb. 7 amendment to that filing describes risk factors related to its ability to continue as a going concern for 12 months after the date of the amended form. The company said that its concern analysis can only include management plans that have been implemented or are probable; it must exclude new products and market launches and those without proven revenue.

Bakkt offers business products, including a turnkey crypto trading API, custody services, and crypto reward solutions. Bakkt discontinued an app aimed at retail users in March 2023. Its parent company, ICE, terminated Bakkt Bitcoin futures and options contracts in September 2023.

SEC filing tells a different story

Despite Bakkt’s assurances to the public, its submission to the SEC explicitly states in bold text:

“We might not be able to continue as a going concern.”

According to the filing, Bakkt said that it is not probable that its revenue will generate sufficient profit and cash flows to continue doing business. It also described “expected operating losses and cash burn for the foreseeable future.”

Another section reads:

” … We have determined that we do not believe that our cash and restricted cash are sufficient to fund our operations for the 12 months following the date of this [filing].”

The firm said it is currently seeking additional capital but noted that various methods of raising capital would not be available or acceptable. One option would be to issue securities, but that would dilute its stock value.

Bakkt said that lack of funding may lead it to reduce expansion efforts, cut operating costs, limit future development, or “even terminate operations.” The firm also expressed uncertainty around the handling of crypto in the event of bankruptcy.

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