Bakkt Faces Class-Action Lawsuit Following Loss of Key Contracts with Webull and Bank of America
Zach Anderson Apr 05, 2025 14:50
Bakkt investors have filed a class-action lawsuit alleging the company misled shareholders by failing to disclose that its revenue heavily depended on contracts with Webull and Bank of America, which are now ending.
Bakkt Holdings, Inc., a digital asset platform specializing in cryptocurrency custody and trading, is facing a class-action lawsuit filed by a group of investors who allege the company made misleading statements and failed to disclose critical information about its business dependencies.
The lawsuit, filed on April 2 in the U.S. District Court for the Southern District of New York, names Bakkt, former CEO and current senior adviser Gavin Michael, CEO Andrew Main, and interim CFO Karen Alexander as defendants. The lead plaintiff, Guy Serge A. Franklin, is seeking a jury trial.
Alleged Misrepresentation of Revenue Sources
The plaintiffs claim Bakkt violated U.S. securities laws by failing to disclose that a substantial portion of its revenue was tied to contracts with Webull and Bank of America (BoA). According to the complaint, Webull accounted for 74% of Bakkt’s crypto services revenue in 2023 and 2024, while BoA contributed 17% of the firm’s loyalty services revenue during the first nine months of 2024.
Investors argue that Bakkt misrepresented the stability and diversity of its revenue streams, leading to inflated expectations about the company’s financial health.
Contracts Not Renewed, Revenue Impact Expected
On March 17, Bakkt disclosed that both Webull and Bank of America would not renew their contracts, which are scheduled to expire in 2025. The investor lawsuit claims this development could result in a 73% drop in top-line revenue and was not adequately communicated in advance.
Following the announcement, Bakkt’s stock price reportedly fell more than 27% in 24 hours, reflecting a sharp market reaction to the projected revenue loss.
“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s securities, Plaintiff and other Class members have suffered significant losses and damages,” the suit alleges.
Potential for Further Legal Action
Several law firms have announced ongoing investigations into Bakkt for potential securities law violations, suggesting that additional lawsuits may be forthcoming.
Bakkt has not issued a public statement in response to the lawsuit.
Stock Volatility and Speculation
Bakkt’s stock (BKKT) has experienced significant volatility in recent months. In November 2024, shares surged over 160% amid speculation that Trump Media & Technology Group was exploring an acquisition. As of April 2025, no formal deal has been announced, and Bakkt’s share price has declined over 36% in the past 30 days, trading at $8.15 at the time of publication.
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