Cryptocurrency company Bakkt appears to be returning to digital asset custody as its main business, Add to According to the announcement on November 15, six new coins are supported.
In addition to Bitcoin (BTC) and Ethereum (ETH), Bakkt will expand its custody support to include Bitcoin Cash (BCH), Dogecoin (DOGE), Ethereum Classic (ETC), Litecoin (LTC) ), Shiba Inu (SHIB) and US Dollar Coin (USDC). The company expects to add more coins to its custody service early next year.
The focus of digital asset custody is to protect the key, which is crucial for the access and transfer of assets. Custodians like Bakkt employ a variety of security measures to protect assets, including cold storage of cryptocurrencies and multi-signature technology that requires multiple approvals for deposits and withdrawals.
The announcement follows Bakkt’s quarterly earnings report on November 14, when the company disclosed Adjusted EBITDA loss (non-GAAP) was $21.6 million, down 30% annually due to lower wages and benefits.
Bakkt’s cryptocurrency revenue reached $191.8 million in the third quarter of 2023, thanks to the acquisition of Apex Crypto in April, the report said. During the quarter, the company’s total revenue was $204.8 million. In terms of assets under custody, Bakkt reported $505.7 million, down 28% from last year.
To strengthen its cryptocurrency custody arm, Bakkt is also developing partnerships. It plans to provide clearing and custody services to Wall Street-backed cryptocurrency exchange EDX Markets, initially acting as a backup qualified custodian, according to the company’s quarterly report. New customers for Bakkt’s custody services include Bitcoin platform Unchained and crypto advisory firm LeboBTC for institutional investors.
“The events of the past year have revealed why qualified cryptocurrency custody is so necessary,” Bakkt CEO Gavin Michael said in a statement.
Expanding hosting services is also an important aspect of Bakkt’s strategy to target business-to-business (B2B) customers. In February, the company announced that it would be canceling its consumer-facing app for 2021 in order to focus on institutions during the crypto winter.
The custody of digital assets is also attracting the attention of many traditional financial institutions. Last year, BNY Mellon, the oldest bank in the United States, launched a digital custody platform to protect ETH and BTC held by selected clients. DZ Bank, Germany’s third largest bank, also began providing cryptocurrency custody services to institutional investors earlier this month.
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