ICE’s Bakkt Acquires Apex Crypto for Up to $200 Million – Ledger Insights

Bakkt, the NYSE-listed crypto and loyalty company, is spending up to $200 million to acquire Apex Crypto, which enables fintechs and trading apps to integrate cryptocurrency trading. Bakkt is a digital asset platform founded by NYSE owner ICE that combines crypto trading with loyalty, including the integration of regular rewards programs.

Apex Crypto offers a turnkey solution aimed at fintechs to incorporate crypto into their offerings. The solution includes account opening, trading and custody. It does not yet offer staking or NFTs, but plans to.

The $200 million deal includes $55 million in cash at closing and $45 million at the end of the year, contingent on performance. An additional $100 million may be paid based on performance through 2025.

Bakkt buys Apex Crypto from the larger Apex Fintech Solutions and has entered into an agreement to offer Bakkt’s crypto offering to Apex’s 220 fintech customers.

“We found a unique asset in Apex Crypto, which will expand our crypto client base, give us faster speed to market for new crypto features and serve as an additional avenue for continued sales to a crypto-savvy audience through Apex Fintech Solutions,” said Gavin Michael, CEO of Bakkt. “With the addition of this complementary business, we believe we are poised to be a crypto provider of choice for financial institutions, fintechs, merchants or loyalty programs.”

Last year, Mastercard partnered with Bakkt to launch a crypto-as-a-service for Mastercard customers, although it was not an exclusive relationship. The card company recently announced a similar deal with Paxos.

Bakkt was founded by NYSE owner ICE in 2018 and first launched crypto derivatives. In 2020, it completed a $300 million Series B round, with a large portion of that earmarked for acquiring Bridge 2 Solutions. The technology firm delivers solutions for 4,500 loyalty and incentive schemes for employees. A year later, Bakkt launched its rewards app. Undoubtedly, rewards will be a major blockchain and crypto application, but Bakkt was perhaps a bit early.

In 2021, Bakkt was listed through a SPAC deal with an enterprise value of more than $2 billion. Shortly after the SPAC merger closed in October 2021, the stock price reached $42, but today is only $2. ICE held a 68% financial stake in the firm at the time of the IPO and announced last week that it had written down the value of the stake from $1.5 billion in June 2022 to $400 million on September 30.