The elected President of the United States, Donald Trump, has placed a significant bet on cryptocurrencies. Now, in addition to his own lending and borrowing crypto platform, World Liberty Financial (WLFI), the politician envisions a cryptocurrency exchange. The media company Trump Media and Technology Group (TMTG), which owns the social network Truth Social, is negotiating to acquire the cryptocurrency exchange Bakkt through a stock swap.
Following this news, Bakkt's shares surged over 160%, along with Trump Media's stock rising by 16.7%.
Despite a market capitalization of $7 billion, Trump Media has yet to achieve profitability. In the third quarter, it incurred a loss of $19 million, earning only $1 million. As of September 30, the company's accounts held approximately $673 million.
“The only thing Trump Media excels at is selling overvalued stocks. Now they plan to use the raised funds to acquire an operating business that could potentially generate revenue and profits,” said Jay Ritter, a finance professor at the University of Florida.
Matthew Tuttle, CEO of Tuttle Capital Management, added that the cryptocurrency market is responding positively to the potential deal, despite the already saturated crypto landscape.
The former head of Bakkt, Kelly Loeffler, is currently co-chair of Trump’s inauguration committee and is the wife of Jeffrey Sprecher, the CEO of the Intercontinental Exchange. The deal with Bakkt could significantly bolster Trump's position in the crypto industry.
No official comments have been made yet by Trump Media, Bakkt, or the Intercontinental Exchange.
Source: Financial Times
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