UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number: 001-39544

BAKKT HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	98-1550750
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
10000 Avalon Boulevard, Suite 1000 Alpharetta, Georgia	30009
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (678) 534-5849

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol (s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share	BKKT	The New York Stock Exchange
Warrants to purchase Class A Common Stock	BKKT WS	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes ☐ No ☒

As of August 9, 2024, there were 6,321,593 shares of the registrant’s Class A Common Stock, 7,194,941 shares of Class V Common Stock, and 7,140,508 public warrants issued and outstanding.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements (Unaudited)	5
	Consolidated Balance Sheets	5
	Consolidated Statements of Operations	6
	Consolidated Statements of Comprehensive Loss	7
	Consolidated Statements of Changes in Stockholders’ Equity	8
	Consolidated Statements of Cash Flows	9
	Notes to Unaudited Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	59
Item 4.	Controls and Procedures	59
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	61
Item 1A.	Risk Factors	61
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	64
Item 3.	Defaults Upon Senior Securities	64
Item 4.	Mine Safety Disclosures	64
Item 5.	Other Information	64
Item 6.	Exhibits	66
	Signatures	67

2

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Unless the context otherwise requires, all references to “Bakkt,” “we,” “us,” “our,” or the “Company” in this Quarterly Report on Form 10-Q (this “Report”) refer to Bakkt Holdings, Inc. and its subsidiaries.

This Report contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. You can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would,” the negative of such terms, and other similar expressions are intended to identify forward-looking statements. These forward-looking statements are based on management’s current expectations, assumptions, hopes, beliefs, intentions and strategies regarding future events and are based on currently available information as to the outcome and timing of future events. We caution you that these forward-looking statements are subject to all of the risks and uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to our business. Forward-looking statements in this Report may include, for example, statements about:

•    our future financial performance;

•    changes in the market for our products and services;

•    the reduction in force announced in May 2024 and future potential reductions of expenses; and

•    expansion plans and opportunities.

These forward-looking statements are based on information available as of the date of this Report and management’s current expectations, forecasts and assumptions, and involve a number of judgments, known and/or unknown risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date. We do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable law.

You should not place undue reliance on these forward-looking statements. Should one or more of a number of known and unknown risks and uncertainties materialize, or should any of our assumptions prove incorrect, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include, but are not limited to:

•our ability to grow and manage growth profitably;

•our ability to continue as a going concern;

•changes in our business strategy;

•changes in the markets in which we compete, including with respect to our competitive landscape, technology evolution or changes in applicable laws or regulations;

•changes in the markets that we target;

•disruptions in the crypto market that subject us to additional risks, including the risk that banks may not provide banking services to us;

•the possibility that we may be adversely affected by other economic, business, and/or competitive factors;

•the inability to launch new services and products or to profitably expand into new markets and services, or the inability to continue offering existing services or products;

•the inability to execute our growth strategies, including identifying and executing acquisitions and our initiatives to add new clients;

•our ability to reach definitive agreements with our expected commercial counterparties;

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•our ability to achieve the expected benefits from the acquisition of Bakkt Crypto;

•our inability to reduce cash expenses and align headcount and employee-related costs with our budget priorities;

•our failure to comply with extensive government regulation, oversight, licensure and appraisals;

•the uncertain regulatory regime governing blockchain technologies and crypto;

•our ability to remediate the material weakness in and establish and maintain effective internal controls and procedures;

•our exposure to any liability, protracted and costly litigation, settlement expenses or reputational damage relating to legal proceedings or our data security;

•the impact of any goodwill or other intangible assets impairments on our operating results;

•the impact of any pandemics or other public health emergencies;

•our ability to maintain the listing of our securities on the NYSE; and

•other risks and uncertainties indicated in this Report, including those set forth under “Risk Factors.”

4

PART I—FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements.

Bakkt Holdings, Inc.

Consolidated Balance Sheets

(in thousands, except share data)

	As of June 30, 2024 (Unaudited)		As of December 31, 2023
Assets
Current assets:
Cash and cash equivalents	$	47,499	$	52,882
Restricted cash	34,031		31,838
Customer funds	53,330		32,925
Available-for-sale securities	13,170		17,398
Accounts receivable, net	24,437		29,664
Prepaid insurance	5,944		13,049
Safeguarding asset for crypto	974,486		701,556
Other current assets	4,508		3,332
Total current assets	1,157,405		882,644
Property, equipment and software, net	1,931		60
Goodwill	68,001		68,001
Intangible assets, net	2,900		2,900
Other assets	12,665		13,262
Total assets	$	1,242,902	$	966,867
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued liabilities	$	39,284	$	55,379
Customer funds payable	53,330		32,925
Deferred revenue, current	2,317		4,282
Due to related party	2,660		3,230
Safeguarding obligation for crypto	974,486		701,556
Unsettled crypto trades	1,453		996
Other current liabilities	3,855		3,706
Total current liabilities	1,077,385		802,074
Deferred revenue, noncurrent	2,753		3,198
Warrant liability	38,757		2,356
Other noncurrent liabilities	21,428		23,525
Total liabilities	1,140,323		831,153
Commitments and contingencies (Note 14)
Class A Common Stock ($0.0001 par value, 30,000,000 shares authorized, 6,310,548 shares issued and outstanding as of June 30, 2024 and 3,793,837 shares issued and outstanding as of December 31, 2023)	1		—
Class V Common Stock ($0.0001 par value, 10,000,000 shares authorized, 7,194,941 shares issued and outstanding as of June 30, 2024 and 7,200,064 shares issued and outstanding as of December 31, 2023)	1		1
Additional paid-in capital	824,023		799,683
Accumulated other comprehensive loss	(341)		(101)
Accumulated deficit	(775,890)		(751,301)
Total stockholders’ equity	47,794		48,282
Noncontrolling interest	54,785		87,432
Total equity	102,579		135,714
Total liabilities and stockholders’ equity	$	1,242,902	$	966,867

The accompanying notes are an integral part of these consolidated financial statements.

5

Bakkt Holdings, Inc.

Consolidated Statements of Operations

(in thousands, except per share data)

(Unaudited)

	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Revenues:
Crypto services	$	497,141	$	335,333	$	1,338,481	$	335,776
Loyalty services, net	12,757		12,296		25,999		25,072
Total revenues	509,898		347,629		1,364,480		360,848
Operating expenses:
Crypto costs	491,701		331,810		1,323,673		332,173
Execution, clearing and brokerage fees	3,392		2,205		9,022		2,205
Compensation and benefits	22,381		27,066		46,912		61,209
Professional services	3,639		2,864		7,274		5,242
Technology and communication	3,651		4,393		9,423		10,111
Selling, general and administrative	5,516		7,566		13,326		14,275
Acquisition-related expenses	55		17,016		66		17,792
Depreciation and amortization	117		3,821		174		6,884
Related party expenses	150		1,512		300		2,112
Impairment of long-lived assets	—		—		288		—
Restructuring expenses	926		220		7,067		4,471
Other operating expenses	387		244		809		908
Total operating expenses	531,915		398,717		1,418,334		457,382
Operating loss	(22,017)		(51,088)		(53,854)		(96,534)
Interest income, net	1,245		701		2,201		2,326
(Loss) gain from change in fair value of warrant liability	(15,114)		357		(6,068)		(643)
Other (expense) income, net	448		(329)		1,164		(345)
Loss before income taxes	(35,438)		(50,359)		(56,557)		(95,196)
Income tax expense	(74)		(152)		(230)		(170)
Net loss	(35,512)		(50,511)		(56,787)		(95,366)
Less: Net loss attributable to noncontrolling interest	(19,088)		(33,663)		(32,198)		(64,546)
Net loss attributable to Bakkt Holdings, Inc.	$	(16,424)	$	(16,848)	$	(24,589)	$	(30,820)
Net loss per share attributable to Class A Common Stockholders:
Basic	$	(2.67)	$	(4.69)	$	(4.66)	$	(8.97)
Diluted	$	(2.67)	$	(4.69)	$	(4.66)	$	(8.97)

The accompanying notes are an integral part of these consolidated financial statements.

6

Bakkt Holdings, Inc.

Consolidated Statements of Comprehensive Loss

(in thousands)

(Unaudited)

	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Net loss	$	(35,512)	$	(50,511)	$	(56,787)	$	(95,366)
Currency translation adjustment, net of tax	(199)		339		(620)		360
Unrealized (losses) gains on available-for-sale securities, net of tax	157		233		(1)		2
Comprehensive loss	$	(35,554)	$	(49,939)	$	(57,408)	$	(95,004)
Comprehensive loss attributable to noncontrolling interest	(19,111)		(33,281)		(32,580)		(64,308)
Comprehensive loss attributable to Bakkt Holdings, Inc.	$	(16,443)	$	(16,658)	$	(24,828)	$	(30,696)

The accompanying notes are an integral part of these consolidated financial statements.

7

Bakkt Holdings, Inc.

Consolidated Statements of Changes in Stockholders’ Equity

(in thousands, except share data)

(Unaudited)

	Class A Common Stock			Class V Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
	Shares	$		Shares	$
Balance as of December 31, 2023	3,793,837	$	—	7,200,064	$	1	$	799,683	$	(751,301)	$	(101)	$	48,282	$	87,432	$	135,714
Share-based compensation	—	—		—	—		8,013		—		—		8,013		—		8,013
Shares issued upon vesting of share-based awards, net of tax withholding	118,593	—		—	—		(2,259)		—		—		(2,259)		—		(2,259)
Equity offerings, net of issuance costs	1,955,924	1		—	—		11,268		—		—		11,269		—		11,269
Exchange of Class V shares for Class A shares	4,725	—		(4,725)	—		63		—		—		63		(63)		—
Currency translation adjustment, net of tax	—	—		—	—		—		—		(160)		(160)		(261)		(421)
Unrealized losses on available-for-sale securities, net of tax	—	—		—	—		—		—		(60)		(60)		(98)		(158)
Net loss	—	—		—	—		—		(8,165)		—		(8,165)		(13,110)		(21,275)
Balance as of March 31, 2024	5,873,079	$	1	7,195,339	$	1	$	816,768	$	(759,466)	$	(321)	$	56,983	$	73,900	$	130,883
Share-based compensation	—	—		—	—		2,406		—		—		2,406		—		2,406
Shares issued upon vesting of share-based awards, net of tax withholding	86,178	—		—	—		(59)		—		—		(59)		—		(59)
Exercise of warrants	12	—		—	—		—		—		—		—		—		—
Equity offerings, net of issuance costs	350,881	—		—	—		4,903		—		—		4,903		—		4,903
Exchange of Class V shares for Class A shares	398	—		(398)	—		5		—		—		5		(5)		—
Currency translation adjustment, net of tax	—	—		—	—		—		—		(92)		(92)		(107)		(199)
Unrealized losses on available-for-sale securities, net of tax	—	—		—	—		—		—		72		72		85		157
Net loss	—	—		—	—		—		(16,424)		—		(16,424)		(19,088)		(35,512)
Balance as of June 30, 2024	6,310,548	$	1	7,194,941	$	1	$	824,023	$	(775,890)	$	(341)	$	47,794	$	54,785	$	102,579

	Class A Common Stock			Class V Common Stock			Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
	Shares	$		Shares	$
Balance as of December 31, 2022	3,237,074	$	—	7,339,310	$	1	$	773,000	$	(676,447)	$	(290)	$	96,264	$	239,811	$	336,075
Share-based compensation	—	—		—	—		6,713		—		—		6,713		—		6,713
Unit-based compensation	—	—		—	—		—		—		—		—		542		542
Shares issued upon vesting of share-based awards, net of tax withholding	59,801	—		—	—		—		—		—		—		—		—
Exchange of Class V shares for Class A shares	8,115	—		(8,115)	—		345		—		—		345		(345)		—
Currency translation adjustment, net of tax	—	—		—	—		—		—		7		7		15		22
Unrealized loss on available-for-sale securities, net of tax	—	—		—	—		—		—		(72)		(72)		(157)		(229)
Net loss	—	—		—	—		—		(13,976)		—		(13,976)		(30,883)		(44,859)
Balance as of March 31, 2023	3,304,990	$	—	7,331,195	$	1	$	780,058	$	(690,423)	$	(355)	$	89,281	$	208,983	$	298,264
Share-based compensation	—	—		—	—		4,614		—		—		4,614		—		4,614
Unit-based compensation	—	—		—	—		—		—		—		—		377		377
Shares issued upon vesting of share-based awards, net of tax withholding	100,828	—		—	—		(2,502)		—		—		(2,502)		—		(2,502)
Shares issued in connection with Apex acquisition	245,624	—		—	—		9,062		—		—		9,062		—		9,062
Currency translation adjustment, net of tax	—	—		—	—		—		—		112		112		227		339
Unrealized losses on available-for-sale securities	—	—		—	—		—		—		77		77		156		233
Net loss	—	—		—	—		—		(16,848)		—		(16,848)		(33,663)		(50,511)
Balance as of June 30, 2023	3,651,442	$	—	7,331,195	$	1	$	791,232	$	(707,271)	$	(166)	$	83,796	$	176,080	$	259,876

The accompanying notes are an integral part of these consolidated financial statements.

8

Bakkt Holdings, Inc.

Consolidated Statements of Cash Flows

(in thousands)

(Unaudited)

	Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Cash flows from operating activities:
Net loss	$	(56,787)	$	(95,366)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	174		6,884
Non-cash lease expense	989		1,548
Share-based compensation expense	10,419		11,327
Unit-based compensation expense	—		946
Impairment of long-lived assets	288		—
Loss on disposal of assets	—		14
Loss from change in fair value of warrant liability	6,068		643
Other	2		14
Changes in operating assets and liabilities:
Accounts receivable	6,035		4,291
Prepaid insurance	7,105		6,871
Accounts payable and accrued liabilities	(16,196)		(11,144)
Unsettled crypto trades	457		—
Due to related party	(570)		(158)
Deferred revenue	(2,410)		(820)
Operating lease liabilities	(1,934)		(1,329)
Customer funds payable	20,405		(56)
Other assets and liabilities	(1,585)		(2,151)
Net cash used in operating activities	(27,540)		(78,486)
Cash flows from investing activities:
Capitalized internal-use software development costs and other capital expenditures	(2,234)		(6,046)
Purchase of available-for-sale securities	(17,996)		(26,999)
Proceeds from the settlement of available-for-sale securities	22,223		153,158
Acquisition of Bumped Financial, LLC	—		(631)
Acquisition of Apex Crypto LLC, net of cash acquired	—		(44,366)
Net cash provided by investing activities	1,993		75,116
Cash flows from financing activities:
Proceeds from Concurrent Offerings, net of issuance costs	46,505		—
Proceeds from the exercise of warrants	3		—
Repurchase and retirement of Class A Common Stock	(2,318)		(2,502)
Net cash provided by (used in) financing activities	44,190		(2,502)
Effect of exchange rate changes	(620)		361
Net increase (decrease) in cash, cash equivalents, restricted cash, customer funds and deposits	18,023		(5,511)
Cash, cash equivalents, restricted cash, customer funds and deposits at the beginning of the period	118,498		115,423
Cash, cash equivalents, restricted cash, customer funds and deposits at the end of the period	$	136,521	$	109,912
Supplemental disclosure of cash flow information:
Non-cash operating lease right-of-use asset acquired	$	—	$	3,780
Supplemental disclosure of non-cash investing and financing activity:
Capitalized internal-use software development costs and other capital expenditures included in accounts payable and accrued liabilities	378		622
Reconciliation of cash, cash equivalents, restricted cash, customer funds and deposits to consolidated balance sheets:
Cash and cash equivalents	$	47,499	$	84,519
Restricted cash	34,031		24,858
Customer funds	53,330		535
Deposits (Note 6)	1,661		—
Total cash, cash equivalents, restricted cash, customer funds and deposits	$	136,521	$	109,912

The accompanying notes are an integral part of these consolidated financial statements.

9

Bakkt Holdings, Inc.

Notes to Consolidated Financial Statements

(Unaudited)

1.Organization and Description of Business

Organization

VPC Impact Acquisition Holdings (“VIH”) was a blank check company incorporated as a Cayman Islands exempted company on July 31, 2020. VIH was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities.

On October 15, 2021 (the “Closing Date”), VIH and Bakkt Opco Holdings, LLC (then known as Bakkt Holdings, LLC, “Opco”) and its operating subsidiaries consummated a business combination (the “VIH Business Combination”) contemplated by the definitive Agreement and Plan of Merger entered into on January 11, 2021 (as amended, the “Merger Agreement”). In connection with the VIH Business Combination, VIH changed its name to “Bakkt Holdings, Inc.” and changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (the “Domestication”).

Unless the context otherwise provides, “we,” “us,” “our,” “Bakkt,” the “Company” and like terms refer to Bakkt Holdings, Inc. and its subsidiaries, including Opco.

Immediately following the Domestication, we became organized in an umbrella partnership corporation, or “up-C,” structure in which substantially all of our assets and business are held by Opco, and our only direct assets consist of common units in Opco (“Opco Common Units”), which are non-voting interests in Opco, and the managing member interest in Opco.

In connection with the VIH Business Combination, a portion of VIH shares were exchanged for cash for shareholders who elected to execute their redemption right. The remaining VIH shares were exchanged for newly issued shares of our Class A Common Stock. Additionally, all outstanding membership interests and rights to acquire membership interests in Opco were exchanged for Opco Common Units and an equal number of newly issued shares of our Class V Common Stock. The existing owners of Opco other than Bakkt are considered noncontrolling interests in the accompanying consolidated financial statements.

On April 1, 2023 we completed the acquisition of 100% of the ownership interests of Apex Crypto LLC ("Apex Crypto") and subsequently changed the name of the legal entity to Bakkt Crypto Solutions, LLC ("Bakkt Crypto Solutions"), effective June 12, 2023. On March 20, 2024, Bakkt Crypto Solutions merged with and into Bakkt Marketplace, LLC ("Bakkt Marketplace"), with Bakkt Marketplace as the surviving entity in the merger. Bakkt Marketplace was then renamed to Bakkt Crypto Solutions, LLC ("Bakkt Crypto").

Description of Business

We provide, or are working to provide, simplified solutions focused in the following areas:

Crypto

•Custody. Our institutional-grade qualified custody solution is primarily provided by our subsidiary, Bakkt Trust Company LLC (“Bakkt Trust”), a limited purpose trust company that is supervised by the New York State Department of Financial Services (“NYDFS”) and governed by an independent Board of Managers. In connection to the acquisition of Apex Crypto, we acquired third-party custodial relationships with BitGo and Coinbase Custody, which are currently used by Bakkt Crypto for custody and coin transfers, where applicable. In addition, Bakkt Crypto also self-custodies select coins to facilitate consumer withdrawals.

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•Trading. Our platform provides customers with the ability to buy, sell and store crypto via application programming interfaces or embedded web experience. We enable clients in various industries to provide their customers with the ability to transact in crypto directly in their trusted environments. We currently facilitate transactions in the crypto assets listed in the table below.

Crypto Asset	Symbol
Bitcoin	BTC
Bitcoin Cash	BCH
Dogecoin	DOGE
Ethereum	ETH
Ethereum Classic	ETC
Litecoin	LTC
Shiba Inu	SHIB
USD Coin	USDC

Bakkt Trust’s custody solution provides support to Bakkt Crypto with respect to all crypto assets supported by the Company. Additionally, until October 2, 2023, Bakkt Trust operated, in conjunction with Intercontinental Exchange, Inc. ("ICE"), regulated infrastructure for trading, clearing, and custody services for physically-delivered bitcoin futures. Refer to Note 8 for a description of a recent delisting of certain Bakkt Bitcoin futures and option contracts by ICE Futures U.S., Inc. ("IFUS"). Bakkt Crypto holds a New York State virtual currency license (commonly referred to as a "BitLicense"), and money transmitter licenses from all states throughout the U.S. where such licenses are required for the operation of its business, and is registered as a money services business with the Financial Crimes Enforcement Network of the United States Department of the Treasury.

As of June 30, 2024, we offer crypto services in the U.S. and in select markets in Latin America, Europe and Asia.

Loyalty

We offer a full spectrum of supplier content through configurable, white-label e-commerce storefronts that end users can acquire via redemption of loyalty points. Our redemption catalog spans a variety of rewards categories including travel, gift cards and merchandise, including a unique Apple product and services storefront. Our travel solution offers a retail e-commerce booking platform with direct supplier integrations, as well as a U.S.-based call center for live-agent booking and servicing. Our platform provides a unified shopping experience that is built to seamlessly extend our customers’ loyalty strategies and user experience for their loyalty programs. Our platform’s functionality includes a mobile-optimized user interface, numerous configurations to support diverse program needs, promotional campaign services, comprehensive fraud protection capabilities and the ability to split payments across both loyalty points and credit cards.

2.Summary of Significant Accounting Policies

Our accounting policies are as set forth in the notes to our Annual Report on Form 10-K for the year ended December 31, 2023 (our "Form 10-K").

Basis of Presentation

The accompanying unaudited interim consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to the Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the unaudited interim consolidated financial statements include the accounts of the Company and our subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In addition, certain reclassifications of

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amounts previously reported have been made to the accompanying consolidated financial statements in order to conform to current presentation.

In the opinion of management, all adjustments (consisting of normal recurring accruals), considered necessary for a fair presentation have been included. The interim results for the three and six months ended June 30, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024, or for any other future annual or interim period. These consolidated financial statements should be read in conjunction with the Company’s audited financial statements and accompanying notes thereto included in our Form 10-K.

On April 29, 2024, following approval by our stockholders and Board of Directors, we effected a reverse stock split (the “Reverse Stock Split”) of our Class A Common Stock, par value $0.0001 per share (“Class A Common Stock”), and Class V Common Stock, par value $0.0001 per share (“Class V Common Stock” and collectively with the Class A Common Stock, the “Common Stock”), at a ratio of 1-for-25 (the “Reverse Stock Split Ratio”). Our Class A Common Stock began trading on a reverse-split adjusted basis on the New York Stock Exchange (the "NYSE") as of the open of trading on April 29, 2024. All outstanding warrants and share-based awards were also adjusted on a 1-for-25 basis. As such, the Reverse Stock Split has been retroactively applied to all share and per share information throughout this Quarterly Report on Form 10-Q (unless otherwise noted).

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. We base our estimates and assumptions on historical experience and various judgments that we believe to be reasonable under the circumstances. The significant estimates and assumptions that affect the financial statements may include, but are not limited to, those that are related to going concern, income tax valuation allowances, useful lives and fair value of intangible assets and property, equipment and software, fair value of financial assets and liabilities, determining provision for doubtful accounts, valuation of acquired tangible and intangible assets, the impairment of intangible and long-lived assets and goodwill, our issued warrants, and fair market value of stock-based awards. Actual results and outcomes may differ from management’s estimates and assumptions and such differences may be material to our audited consolidated financial statements.

Liquidity and Going Concern

The accompanying unaudited consolidated financial statements are prepared on a going concern basis in accordance with U.S. GAAP. This presentation contemplates the realization of assets and the satisfaction of liabilities in the normal course of business and does not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of the uncertainties described below.

At each reporting period, in accordance with Accounting Standards Codification ("ASC") 205-40, Going Concern, we evaluate whether there are conditions or events that raise substantial doubt about our ability to continue as a going concern within one year after the date the financial statements are issued. In accordance with ASC 205-40, our initial evaluation can only include management’s plans that have been fully implemented as of the issuance date. Operating forecasts for new products/markets cannot be considered in the initial evaluation as those product/market launches have not been fully implemented.

Accordingly, our evaluation entails analyzing prospective fully implemented operating budgets and forecasts for expectations of our cash needs and comparing those needs to the current cash and cash equivalent balances. This evaluation initially does not take into consideration the potential mitigating effect of management’s plans that have not been fully implemented as of the date the financial statements are issued. When substantial doubt exists under this methodology, we evaluate whether the mitigating effect of our plans sufficiently alleviates substantial doubt about our ability to continue as a going concern. The mitigating effect of management’s plans, however, is only considered if both (1) it is probable that the

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plans will be effectively implemented within one year after the date that the financial statements are issued, and (2) it is probable that the plans, when implemented, will mitigate the relevant conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern within one year after the date that these consolidated financial statements are issued.

Evaluation in conjunction with the issuance of the June 30, 2024 unaudited Consolidated Financial Statements

We have incurred net losses and consumed cash flow from operations since our inception and incurred losses and consumed cash through the date of this filing in excess of our cash inflows from operations and fundraising. Due to these ongoing losses and a limited supply of remaining cash and available-for-sale securities, we have been executing a strategic plan to optimize our capital allocation and expense base since the fourth quarter of 2022, which has reduced our annual cash expenses year over year and which we expect will continue to reduce our cash expenses in 2024. As a part of those plans, we will continue to align headcount and employee-related costs to further reduce cash expenses. We completed a reduction in force on May 2, 2024 as part of a broader expense restructuring initiative that also contemplated closing certain open roles and optimization of our contact center resources. This expense restructuring initiative is expected to result in aggregate cash savings of approximately $13.0 million, excluding severance over the next 12 months. We expect to enact additional personnel and discretionary spending cuts such as incentive compensation, marketing, professional services and administrative travel to preserve cash to fund operations. We received approval in March 2024 to integrate, and have subsequently merged and integrated, Bakkt Marketplace and Bakkt Crypto Solutions, which reduced the amount of restricted cash we were required to hold for insurance collateral by $11.6 million and eliminated approximately $7.0 million of duplicate regulatory capital requirements. However, it is critical to our plan to mitigate our cash burn that we significantly expand our revenue base to be able to generate a sustainable operating profit. There is significant uncertainty associated with our expansion to new markets and the growth of our revenue base given the uncertain and rapidly evolving environment associated with crypto assets.

For the six months ended June 30, 2024 we incurred a net loss of $56.8 million and consumed $27.5 million of cash in operations. We have historically relied on our existing cash and available-for-sale securities portfolio to fund operations. As of June 30, 2024, we had $47.5 million of available cash and cash equivalents that was not restricted or required to be held for regulatory capital (Note 13) and $13.2 million in available-for-sale securities. We do not have any long-term debt to service but have commitments under long-term cloud computing, lease and marketing contracts as described in Notes 14 and 17. We expect to continue to incur losses and consume cash for the foreseeable future. As discussed in Note 20, Opco executed a secured revolving credit facility with Intercontinental Exchange Holdings, Inc. (the “Lender”; the credit facility herein referred to as the “ICE Credit Facility”), with Bakkt and certain subsidiaries of Bakkt as guarantors, which provides the Company with a $40.0 million secured revolving line of credit that matures on December 31, 2026. The $40.0 million ICE Credit Facility is available in defined commitment amounts at specified dates in the future. We believe after giving effect to management's execution of the ICE Credit Facility, that our cash, short-term securities, and access to the ICE Credit Facility will be sufficient to fund our operations for the next 12 months from the date of these financial statements.

Recently Adopted Accounting Pronouncements

For the six months ended June 30, 2024, there were no significant changes to the recently adopted accounting pronouncements applicable to us from those disclosed in Note 2 to the consolidated financial statements included in our Form 10-K.

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280), Improvements to Reportable Segment Disclosures, which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses. The updated standard will be effective for our annual periods beginning in fiscal 2024 and

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interim periods beginning in the first quarter of fiscal 2025. Early adoption is permitted. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740), Improvements to Income Tax Disclosures, which will require additional tax disclosures, predominantly related to the effective income tax rate reconciliation and income taxes paid. The updated standard will be effective for our annual periods beginning in fiscal 2025. Early adoption is permitted. We are currently evaluating the impact that the updated standard will have on our financial statement disclosures.

3.Revenue from Contracts with Customers

Disaggregation of Revenue

We disaggregate revenue by service type and by platform as follows (in thousands):

Service Type	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Transaction revenue	$	503,717	$	342,542	$	1,351,701	$	350,248
Subscription and service revenue	6,181		5,087		12,779		10,600
Total revenue	$	509,898	$	347,629	$	1,364,480	$	360,848

Platform	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Loyalty redemption platform, net	$	12,757	$	12,296	$	25,999	$	25,072
Crypto services	497,141		335,333		1,338,481		335,776
Total revenue	$	509,898	$	347,629	$	1,364,480	$	360,848

We recognized revenue from foreign jurisdictions of $10.5 million and $24.9 million for the three and six months ended June 30, 2024, respectively, and $0.8 million and $1.7 million for the three and six months ended June 30, 2023, respectively.

We have one reportable segment to which our revenues relate.

Deferred Revenue

Contract liabilities consist of deferred revenue for amounts invoiced prior to us meeting the criteria for revenue recognition. We invoice customers for service fees at the beginning of service performance, and such fees are recognized as revenue over time as we satisfy performance obligations. Contract liabilities are classified as “Deferred revenue, current” and “Deferred revenue, noncurrent” in our consolidated balance sheets. The activity in deferred revenue for the six months ended June 30, 2024 and June 30, 2023, respectively, was as follows (in thousands):

	Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Beginning of the period contract liability	$	7,480	$	7,084
Revenue recognized from contract liabilities included in the beginning balance	(2,815)		(2,121)
Increases due to cash received, net of amounts recognized in revenue during the period	405		1,301
End of the period contract liability	$	5,070	$	6,264

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Remaining Performance Obligations

As of June 30, 2024, the aggregate amount of the transaction price allocated to the remaining performance obligations related to partially completed contracts is $15.4 million, comprised of $10.3 million of subscription fees and $5.1 million of service fees that are deferred. We recognize our subscription fees as revenue over a weighted-average period of 20 months (ranges from 2 months to 27 months) and our service fees as revenue over approximately 33 months.

As of June 30, 2023, the aggregate amount of the transaction price allocated to the remaining performance obligations related to partially completed contracts is $22.2 million, comprised of $15.6 million of subscription fees and $6.6 million of service fees that are deferred. We recognize our subscription fees as revenue over a weighted-average period of 30 months (ranges from 4 months to 39 months) and our service fees as revenue over approximately 15 months.

Contract Costs

For the three and six months ended June 30, 2024 and June 30, 2023, we incurred no incremental costs to obtain and/or fulfill contracts with customers.

4.Business Combination and Asset Acquisition

Apex Crypto

On April 1, 2023 we completed the acquisition of 100% of the ownership interests of Apex Crypto. We recognized goodwill from the acquisition due to the assembled, experienced workforce and anticipated growth we expect to achieve from Apex Crypto’s sales pipeline and product capabilities. The total consideration as measured at April 1, 2023 included $55.0 million in cash, approximately $10.5 million in Class A Common Stock payable based on Apex Crypto’s performance in the fourth quarter of 2022, and $11.8 million of cash paid for net working capital, which was predominantly cash held in banks. In addition, we may pay up to $100.0 million of our Class A Common Stock as additional consideration depending on Apex Crypto’s achievement of certain financial targets through 2025 (the "contingent consideration"). As part of the purchase price allocation, the value of the contingent consideration was estimated to be $2.9 million.

The following is a reconciliation of the fair value of consideration transferred in the acquisition to the fair value of the assets acquired and liabilities assumed.

($ in millions)
Cash consideration paid	$	55.0
Cash paid for working capital and cash	11.8
Class A Common Stock at transaction close	10.5
Estimated fair value of Class A Common Stock contingent consideration	2.9
Total consideration	$	80.2
Current assets	31.8
Safeguarding asset for crypto	689.3
Non-current assets	0.3
Intangible assets - developed technology	5.6
Intangible assets - customer relationships	10.2
Goodwill	52.0
Current liabilities	(19.7)
Safeguarding obligation for crypto	(689.3)
Net assets acquired	$	80.2

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The above fair values are as of the acquisition date. The acquired intangible assets and goodwill required the use of significant unobservable inputs including partner activation forecasts, expectations about customer trading volume and frequency, customer attrition rates, and estimated useful lives of acquired technology and discount rates (level 3 inputs). The acquired customer relationships were valued using a multi-period excess earnings model. The acquired developed technology was valued using a relief from royalty method. Acquired crypto safeguarding asset and obligation were valued based on the midpoint of a bid-ask spread as of the acquisition date (level 2 inputs). Other assets and liabilities were carried over at their acquired costs which was not materially different than their fair values.

The contingent consideration payable in Class A Common Stock to Apex Crypto's former owners based on the performance of the business in the 2023 through 2025 annual periods was estimated using a Monte Carlo simulation given the range of possible outcomes. As of December 31, 2023, we determined the value of the contingent consideration was zero, based on our forward-looking projections and minimum profit requirements associated with the contingent consideration and reversed the accrual through acquisition expenses. As of June 30, 2024, we determined the value of the contingent consideration remained zero.

The following unaudited pro forma financial information presents the Company's results of operations as if the acquisition of Apex Crypto had occurred on January 1, 2023. The unaudited pro forma financial information as presented below is for illustrative purposes and does not purport to represent what the results of operations would actually have been if the acquisition of Apex Crypto occurred as of the date indicated or what the results would be for any future periods. The unaudited pro forma results reflect the step-up amortization adjustments for the fair value of intangible assets acquired, acquisition-related expenses, and share-based compensation expense for newly issued restricted stock units. Pro forma revenue for the six months ended June 30, 2023 would be $806.0 million. Pro forma net loss for the six months ended June 30, 2023 would be $86.1 million.

Subsequent to the acquisition, we changed the name of Apex Crypto to Bakkt Crypto Solutions, LLC ("Bakkt Crypto Solutions").

Bumped Acquisition

On February 8, 2023, we acquired 100% of the units of Bumped Financial, LLC, which we subsequently renamed Bakkt Brokerage, LLC ("Bakkt Brokerage"), a broker-dealer registered with the SEC and the Financial Industry Regulatory Authority, Inc., for cash consideration of $0.6 million. Because of the limited scope of its historical operations, we determined that substantially all of the purchase consideration in the transaction would be allocated to the in-place licenses Bakkt Brokerage held and as such, have accounted for this as an asset acquisition.

5.Goodwill and Intangible Assets, Net

Changes in goodwill consisted of the following (in thousands):

	Gross Carrying Amount		Accumulated Impairment Losses		Net Carrying Amount
Balance as of December 31, 2023	$	1,579,265	$	(1,511,264)	$	68,001
Foreign currency translation	—		—		—
Balance as of June 30, 2024	$	1,579,265	$	(1,511,264)	$	68,001

We did not identify any indicators of impairment during the three months ended June 30, 2024. During the three months ended March 31, 2024, we identified a triggering event related to the significant decline in our stock price, indicating a potential impairment of our goodwill. We determined no goodwill impairment charge was required based on a comparison of our market capitalization against the carrying value of our equity.

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Intangible assets consisted of the following (in thousands):

	June 30, 2024
	Weighted Average Useful Life (in years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Trademarks / trade names	Indefinite	2,900		—		2,900
Total		$	2,900	$	—	$	2,900

	December 31, 2023
	Weighted Average Useful Life (in years)	Gross Carrying Amount		Accumulated Amortization		Impairment		Net Carrying Amount
Licenses	Indefinite	$	611	$	—	$	(611)	$	—
Trademarks / trade names	Indefinite	8,000		—		(5,100)		2,900
Technology	5	18,360		(6,234)		(12,126)		—
Customer relationships	8.4	55,170		(12,508)		(42,662)		—
Total		$	82,141	$	(18,742)	$	(60,499)	$	2,900

We did not record any amortization of intangible assets for the three and six months ended June 30, 2024 as our finite-lived intangible assets have been fully impaired. Amortization of intangible assets for the three and six months ended June 30, 2023 was $2.7 million and $4.7 million, respectively, and is included in “Depreciation and amortization” in the consolidated statements of operations.

Estimated future amortization for definite-lived intangible assets as of June 30, 2024 was zero as our finite-lived intangible assets had been fully impaired.

We account for crypto we own as indefinite-lived intangible assets and initially measure such crypto at cost (under a first-in, first-out basis) under the guidance in ASC 350, Intangibles - Goodwill and Other. These assets are not amortized, but assessed for impairment given the volatility of markets for these assets. Impairment exists when the carrying amount exceeds its fair value. The fair value of crypto is determined as the lowest price of executed transactions during the measurement or holding period using the quoted price of the crypto in our principal market. The carrying amount of a crypto asset after its impairment becomes its new cost basis. Impairment losses are not reversible or recoverable and are included in “Crypto costs” in the consolidated statements of operations. Impairment losses were not material for the three and six months ended June 30, 2024 and June 30, 2023, respectively. Our owned crypto is typically liquidated on a daily basis during the fulfillment of customer orders and settlement with our liquidity providers. Our owned crypto was not material as of June 30, 2024 and December 31, 2023 and is included within "Other assets" in the consolidated balance sheets. We classify cash flows from crypto within cash flows from operating activities.

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6.Consolidated Balance Sheet Components

Accounts Receivable, Net

Accounts receivable, net consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Trade accounts receivable	$	12,738	$	14,987
Receivables from customers, clients and liquidity partners	3,705		6,123
Unbilled receivables	4,540		6,125
Deposits	1,733		939
Other receivables	2,816		2,221
Total accounts receivable	25,532		30,395
Less: Allowance for doubtful accounts	(1,095)		(731)
Total	$	24,437	$	29,664

Deposits includes cash, as noted on the consolidated statements of cash flows, at clearing agencies used to settle customer transactions. Amounts payable and receivable to our liquidity providers are reported net by counterparty when the right of offset exists.

Other Current Assets

Other current assets consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Prepaid expenses	$	4,433	$	3,307
Other	75		25
Total	$	4,508	$	3,332

Property, Equipment and Software, Net

Property, equipment and software, net consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Internal-use software	$	1,722	$	—
Other computer and network equipment	848		800
Leasehold improvements	276		—
Property, equipment and software, gross	2,846		800
Less: accumulated amortization and depreciation	(915)		(740)
Total	$	1,931	$	60

For the three and six months ended June 30, 2024, depreciation and amortization expense related to property, equipment and software amounted to $0.1 million and $0.2 million, respectively, of which $0.1 million and $0.1 million, respectively, related to amortization expense of capitalized internal-use software placed in service.

For the three and six months ended June 30, 2023, depreciation and amortization expense related to property, equipment and software amounted to $1.3 million and $2.3 million, respectively, of which $0.4 million and $0.7 million, respectively, related to amortization expense of capitalized internal-use software placed in service.

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Other Assets

Other assets consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Operating lease right-of-use assets	$	10,467	$	11,456
Deposits with clearinghouse	159		159
Other	2,039		1,647
Total	$	12,665	$	13,262

Accounts Payable and Accrued Liabilities

Accounts payable and accrued liabilities consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Accounts payable	$	5,882	$	14,925
Payables to clients and customers	2,265		4,906
Accrued expenses	15,703		15,970
Purchasing card payable	3,818		11,830
Salaries and benefits payable	6,534		4,442
Loyalty revenue share liability	2,780		2,686
Other	2,302		620
Total	$	39,284	$	55,379

Other Current Liabilities

Other current liabilities consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Current maturities of operating lease liability	3,802		3,636
Other	53		70
Total	$	3,855	$	3,706

Other Noncurrent Liabilities

Other noncurrent liabilities consisted of the following (in thousands):

	June 30, 2024		December 31, 2023
Operating lease liability, noncurrent	$	21,428	$	23,525
Total	$	21,428	$	23,525

Amounts receivable and payable included in the tables above related to our crypto transactions pending settlement with our customers and liquidity providers were settled in July 2024 in amounts consistent with those reflected above.

7.Tax Receivable Agreement

On October 15, 2021, we entered into a Tax Receivable Agreement (the "TRA") with certain Opco equity holders. Each Opco common unit, when coupled with one share of our Class V Common Stock is referred to as a “Paired Interest.” Pursuant to the TRA, among other things, holders of Opco Common Units may, subject to certain conditions, from and after April 16, 2022, exchange such Paired Interests for Class A Common Stock on a one-for-one basis, subject to the terms

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of the Exchange Agreement, including our right to elect to deliver cash in lieu of Class A Common Stock and, in certain cases, adjustments as set forth therein. Opco will have in effect an election under Section 754 of the Internal Revenue Code for each taxable year in which an exchange of Opco Common Units for Class A Common Stock (or cash) occurs.

The exchanges are expected to result in increases in the tax basis of the tangible and intangible assets of Opco. These increases in tax basis may reduce the amount of tax that we would otherwise be required to pay in the future. These increases in tax basis may also decrease gains (or increase losses) on future dispositions of certain capital assets to the extent tax basis is allocated to those capital assets.

The TRA provides for the payment by us to exchanging holders of Opco Common Units of 85% of certain net income tax benefits, if any, that we realize (or in certain cases are deemed to realize) as a result of these increases in tax basis related to entering into the TRA, including tax benefits attributable to payments under the TRA. This payment obligation is an obligation of the Company and not of Opco. For purposes of the TRA, the cash tax savings in income tax will be computed by comparing our actual income tax liability (calculated with certain assumptions) to the amount of such taxes that we would have been required to pay had there been no increase to the tax basis of the assets of Opco as a result of Opco having an election in effect under Section 754 of the Code for each taxable year in which an exchange of Opco Common Units for Class A Common Stock occurs and had we not entered into the TRA. Such change will be calculated under the TRA without regard to any transfers of Opco Common Units or distributions with respect to such Opco Common Units before the exchange under the Exchange Agreement to which Section 743(b) or 734(b) of the Code applies. As of June 30, 2024, 1,043,210 Opco Common Units had been exchanged for Class A Common Stock. Refer to Note 14 regarding the contingency related to the TRA.

8.Related Parties

ICE Management and Technical Support

Upon consummation of the VIH Business Combination, we entered into a Transition Services Agreement (the “ICE TSA”) with ICE, pursuant to which ICE provides insurance, digital warehouse, data center, technical support, and other transition-related services in exchange for quarterly service fees payable by us. We did not recognize any expense related to the ICE TSA for the three and six months ended June 30, 2024, respectively. We recognized $1.0 million and $1.6 million of expense related to the ICE TSA for the three and six months ended June 30, 2023, respectively, which is reflected as “Related party expenses” in the consolidated statements of operations. As of June 30, 2024 and December 31, 2023, we had $2.2 million and $3.0 million, respectively, reflected as “Due to related party” in the consolidated balance sheets related to the ICE TSA. The agreement terminated in December 2023.

Triparty Agreement

The Digital Currency Trading, Clearing, and Warehouse Services Agreement ("Triparty Agreement") provided for ICE Futures U.S., Inc. ("IFUS") to list for trading one or more digital currency futures and/or options contracts, and for ICE Clear US, Inc. ("ICUS") to serve as the clearing house to provide central counterparty and ancillary services for such contracts.

Effective July 28, 2023, IFUS delisted all Bakkt Bitcoin futures contracts other than the August and September 2023 expiry months, and also delisted all Bakkt Bitcoin Option contracts. Following the delisting, no new Bakkt Bitcoin futures or option expiry months were listed for trading. The August and September 2023 expiry months continued to be listed for trading through their regular last trading days, which were August 24 and September 28, 2023 respectively. No material revenues associated with the Triparty Agreement were recognized during the three and six months ended June 30, 2023, respectively. Effective October 2, 2023, the parties terminated the Triparty Agreement.

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Apex Crypto Technical Support

In connection with our acquisition of Apex Crypto, we entered into a Transition Services Agreement (the “Apex TSA”) with Apex Fintech Solutions, Inc. ("AFS"), pursuant to which AFS provides technical support and other transition-related services in exchange for quarterly service fees payable by us. We recognized approximately $0.2 million and $0.3 million of expense related to the Apex TSA for the three and six months ended June 30, 2024, respectively, which are reflected as “Related party expenses” in the consolidated statements of operations. We recognized $0.5 million of expense related to the Apex TSA for the three months ended June 30, 2023 which is reflected as “Related party expenses” in the consolidated statements of operations. As of June 30, 2024 and December 31, 2023, we had approximately $0.5 million and $0.2 million, respectively, reflected as “Due to related party” in the consolidated balance sheets related to the Apex TSA.

ICE Credit Facility

On August 12, 2024, we entered into the ICE Credit Facility with ICE. Refer to Note 20 for more information.

9.Warrants

As of June 30, 2024 and December 31, 2023, there were 7,140,508 public warrants outstanding. Public warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the public warrant. Holders of public warrants are entitled to purchase one share of Class A Common Stock for every 25 public warrants. The exercise price associated with such warrants is equivalent to $287.50 per share of Class A Common Stock. The public warrants became exercisable on November 15, 2021. The public warrants will expire on October 15, 2026, or earlier upon redemption or liquidation. We may redeem the outstanding warrants when various conditions are met, such as specific stock prices, as detailed in the specific warrant agreements. The warrants are recorded as a liability and reflected as “Warrant liability” in the consolidated balance sheets.

During the three and six months ended June 30, 2024, we received less than $0.1 million in proceeds from the exercise of the public warrants. During the three and six months ended June 30, 2023, we did not receive any proceeds from the exercise of the public warrants. We recognized a loss from the change in fair value of the warrant liability during the three months ended June 30, 2024 of $0.3 million and a gain from the change in fair value of the warrant liability during the six months ended June 30, 2024 of $1.1 million. We recognized a gain from the change in fair value of the warrant liability during the three months ended June 30, 2023 of $0.4 million and a loss during the six months ended June 30, 2023 of $0.6 million.

In connection with the Concurrent Offerings (Note 10), we issued and sold to the Third-Party Purchasers an aggregate of 1,396,701 shares of the Company’s Class A Common Stock, including 196,701 shares of Class A Common Stock issued upon exercise of certain of the Pre-Funded Warrants (as defined below) prior to the Third-Party Closing, Class 1 Warrants (“Class 1 Warrants”) to purchase an aggregate of 922,722 shares of Class A Common Stock, Class 2 Warrants (“Class 2 Warrants”) to purchase an aggregate of 922,722 shares of Class A Common Stock and Pre-Funded Warrants (“Pre-Funded Warrants”) to purchase an aggregate of 448,742 shares of Class A Common Stock.

Concurrently, under the terms of the ICE Offering we entered into a securities purchase agreement (the “ICE Purchase Agreement” and, together with the Third-Party Purchase Agreement, the “Purchase Agreements”) with ICE, pursuant to which we issued and sold to ICE an aggregate of 461,361 shares of Class A Common Stock, Class 1 Warrants to purchase an aggregate of 230,680 shares of Class A Common Stock, and Class 2 Warrants to purchase an aggregate of 230,680 shares of Class A Common Stock. The consummation of the transactions contemplated by the ICE Purchase Agreement occurred on March 4, 2024 and April 25, 2024.

The Class 1 and Class 2 Warrants have an exercise price of $25.50 and have a five-and-a-half year term. The Class 1 and Class 2 Warrants may be exercised at any time after the 6 month anniversary of the relevant closing. The Class

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2 warrant agreement contains an alternative exercise clause that entitles the holder to exchange two warrants for a share of stock if certain conditions are met. The Class 1 and Class 2 Warrants issued in the Concurrent Offerings are initially recorded as a liability at fair value and reflected as “Warrant liability” in the consolidated balance sheets.

The warrants issued on April 25, 2024 were valued at $2.6 million using the Black-Scholes-Merton model for Class 1 Warrants and a binomial lattice model for the Class 2 Warrants. Prior to the three months ended June 30, 2024, we used a Monte Carlo simulation to measure the fair value of the Class 2 Warrants. During the three months ended June 30, 2024, we adopted a binomial lattice model as our valuation technique as we believe it provides a more accurate and relevant measure of the fair value of the Class 2 Warrants. The Class 1 Warrants and Class 2 Warrants issued on March 4, 2024 were valued at $27.7 million using the Black-Scholes-Merton model for Class 1 Warrants and a Monte Carlo simulation for the Class 2 Warrants.

As of June 30, 2024, all Class 1 Warrants and Class 2 Warrants remain outstanding. During the three months ended March 31, 2024, holders exercised all of the Pre-Funded Warrants. The proceeds received from the exercise of Pre-Funded Warrants were immaterial. We recognized a loss from the change in fair value of the warrant liability associated with the Class 1 and Class 2 Warrants during the three and six months ended June 30, 2024 of $14.8 million and $7.2 million, respectively.

10.Stockholders’ Equity

2024 Registered Direct Offering

On February 29, 2024, we entered into a securities purchase agreement with certain institutional investors, pursuant to which we agreed to sell and issue a combination of Class A Common Stock, Class 1 Warrants, Class 2 Warrants and Pre-Funded Warrants in a registered direct offering (the “Third-Party Offering”). In a concurrent registered direct offering (the “ICE Offering” and, together with the Third-Party Offering, the “Concurrent Offerings”) on February 29, 2024, we entered into a securities purchase agreement with ICE (a related party), pursuant to which we agreed to sell and issue a combination of Class A Common Stock, Class 1 Warrants and Class 2 Warrants. We raised net proceeds from the Third-Party Offering of approximately $37.6 million, after deducting the placement agent’s fees and estimated offering expenses payable by us, and raised net proceeds from the ICE Offering of approximately $9.8 million, after deducting estimated offering expenses payable by us. Approximately $2.4 million of proceeds from the ICE Offering were received concurrently with the closing of the Third-Party Offering, with the remaining $7.4 million received in a subsequent closing of the ICE Offering on April 25, 2024 after we obtained stockholder approval for such issuance. We intend to use the net proceeds from the Concurrent Offerings for working capital and other general corporate purposes.

Preferred Stock

We are authorized to issue 1,000,000 shares of preferred stock with a par value of $0.0001 per share. The holders of a series of preferred stock shall be entitled only to such voting rights as shall expressly be granted thereto by the Certificate of Incorporation (including any certificate of designation relating to such series of preferred stock). As of June 30, 2024, no shares of preferred stock have been issued.

Common Stock

Class A Common Stock

We are authorized to issue 30,000,000 shares with a par value of $0.0001 per share. Each holder of record of Class A Common Stock is entitled to one vote for each share of Class A Common Stock held on all matters on which stockholders generally or holders of Class A Common Stock as a separate class are entitled to vote, including the election or removal of directors (whether voting separately as a class or together with one or more classes of our capital stock). As of June 30, 2024 and December 31, 2023, there were 6,310,548 and 3,793,837 shares of Class A Common Stock issued and outstanding, respectively.

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Dividends

Subject to preferences that may be applicable to any outstanding preferred stock, the holders of shares of Class A Common Stock are entitled to receive ratably such dividends, if any, as may be declared from time to time by our Board out of funds legally available therefor. As of June 30, 2024, no dividends have been declared.

Liquidation

In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of Class A Common Stock are entitled to share ratably in all assets remaining after payment of our debts and other liabilities, subject to prior distribution rights of preferred stock or any class or series of stock having a preference over the Class A Common Stock, then outstanding, if any.

Class V Common Stock

We are authorized to issue 10,000,000 shares with par value $0.0001 per share. These shares have no economic value but entitle the holder to one vote per share. Paired Interests may be exchanged for one share of our Class A Common Stock or a cash amount in accordance with the Third Amended and Restated Limited Liability Company Agreement of Opco and the Amended and Restated Exchange Agreement. Holders of Paired Interests became eligible on April 16, 2022 under the Exchange Agreement to exchange their Paired Interests for Class A Common Stock, or, at our election, cash in lieu thereof. During the three and six months ended June 30, 2024, holders of Paired Interests exchanged 398 and 5,123 Paired Interests for our Class A Common Stock, and we did not elect to settle any such exchanges in cash. As of June 30, 2024 and December 31, 2023, there were 7,194,941 and 7,200,064 shares of Class V Common Stock issued and outstanding, respectively.

Dividends

Dividends will not be declared or paid on the Class V Common Stock.

Liquidation

In the event of any voluntary or involuntary liquidation, dissolution or winding up of our affairs, the holders of Class V Common Stock shall not be entitled to receive any of our assets.

Restrictions

In the event that any outstanding share of Class V Common Stock ceases to be held directly or indirectly by a holder of Opco Common Units, such share will automatically be transferred to us and cancelled for no consideration. We will not issue additional shares of Class V Common Stock, other than in connection with the valid issuance or transfer of Opco Common Units in accordance with Opco’s Third Amended and Restated Limited Liability Company Agreement (the “LLC Agreement”).

Noncontrolling Interest

The following table summarizes the ownership interest in Opco as of June 30, 2024 and December 31, 2023.

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	June 30, 2024			December 31, 2023
	Opco Common Units	Ownership %		Opco Common Units	Ownership %
Opco common units held by Bakkt Holdings, Inc.	6,310,548	47	%	3,793,837	35	%
Opco common units held by noncontrolling interest holders	7,194,941	53	%	7,200,064	65	%
Total Opco common units outstanding	13,505,489	100	%	10,993,901	100	%

The weighted average ownership percentages for the applicable reporting periods are used to attribute net loss and other comprehensive loss to the Company and the noncontrolling interest holders. The noncontrolling interest holders' weighted average ownership percentage for the three and six months ended June 30, 2024 was 53.9% and 57.7%, respectively.

Members’ Equity

Prior to the VIH Business Combination, Opco had three classes of voting units – Class A, Class B and Class C voting units – and incentive units granted under the Opco Incentive Equity Plan (the “Opco Plan”).

In connection with the VIH Business Combination, Class C warrants of Opco ("Class C Warrants") automatically converted into the right to purchase 31,734 Paired Interests in Opco at an exercise price of $126.00 per Paired Interest. Class C Warrants may only be exercised for a whole number of Paired Interests. Holders of Class C Warrants are entitled to purchase one Paired Interest for every 25 Class C Warrants. As of June 30, 2024, 172,055 Class C Warrants have vested but have not been exercised, and the remaining 621,297 Class C Warrants have not vested or been exercised. No expenses were recorded during the three and six months ended June 30, 2024 and June 30, 2023, since the service conditions were not probable of being met in those periods.

11.Share-Based and Unit-Based Compensation

2021 Incentive Plan

Our 2021 Omnibus Incentive Plan, as amended (the “2021 Incentive Plan”), became effective on the Closing Date with the approval of VIH’s shareholders and the Board of Directors. The 2021 Incentive Plan allows us to make equity and equity-based incentive awards to employees, non-employee directors and consultants. As of December 31, 2023, there were 2,096,295 shares of Class A Common Stock reserved for issuance under the 2021 Incentive Plan which can be granted as stock options, stock appreciation rights, restricted shares, restricted stock units ("RSUs"), performance stock units ("PSUs"), dividend equivalent rights and other share-based awards. On May 31, 2024, the 2021 Incentive Plan was amended to increase by 938,625 shares the number of authorized shares of Class A Common Stock available for issuance for a new aggregate total of 3,034,920 shares authorized. No award may vest earlier than the first anniversary of the date of grant, subject to limited exceptions.

Share-Based Compensation Expense

During the three and six months ended June 30, 2024, we granted 545,553 and 1,028,152 RSUs, respectively, to employees and directors. During the three and six months ended June 30, 2024, we did not grant any PSUs. During the three and six months ended June 30, 2023, we granted 127,155 and 307,610 RSUs, respectively, to employees and directors. During the three months ended June 30, 2023, we granted 26,945 PSUs to employees and directors. We did not grant any PSUs during the first quarter of 2023.

We recorded $2.4 million and $10.1 million of share-based compensation expense related to RSUs during the three and six months ended June 30, 2024, respectively. We recorded $3.6 million and $9.4 million of share-based compensation expense related to RSUs during the three and six months ended June 30, 2023, respectively. We recorded zero and $0.3 million of share-based compensation expense related to PSUs during the three and six months ended June 30,

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2024, respectively. We recorded $0.5 million and $1.9 million of share-based compensation expense related to PSUs during the three and six months ended June 30, 2023, respectively. Share-based compensation expense for both RSUs and PSUs, except for share-based compensation expense related to the Company's restructuring efforts discussed below, is included in “Compensation and benefits” in the consolidated statements of operations.

Unrecognized compensation expense as of June 30, 2024 and December 31, 2023 was $14.3 million and $14.3 million, respectively, for the RSUs and PSUs. The unrecognized compensation expense as of June 30, 2024 and December 31, 2023 will be recognized over a weighted-average period of 1.71 years and 1.38 years, respectively.

RSU and PSU Activity

The following tables summarize RSU and PSU activity under the 2021 Incentive Plan for the six months ended June 30, 2024 and June 30, 2023 (in thousands, except per unit data):

RSUs and PSUs	Number of RSUs and PSUs	Weighted Average Remaining Contractual Term (years)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding as of December 31, 2022	551	2.05	$	101.25
Granted	334		$	37.25	$	12,468
Forfeited	(75)
Vested	(205)
Outstanding as of June 30, 2023	605	1.79	$	73.25
Outstanding as of December 31, 2023	521	1.38	$	69.75
Granted	1,028		$	12.05	12,393
Forfeited	(115)
Vested	(325)
Outstanding as of June 30, 2024	1,109	1.71	$	19.46

During the three and six months ended June 30, 2024, we recorded $4.9 million and $4.9 million, respectively, of share-based compensation expense related to the accelerated vesting of awards for certain employees, primarily related to the termination of a former executive. Acceleration of share-based compensation expense related to our restructuring efforts is included in “Restructuring expenses” in the consolidated statements of operations. We also recorded reversal of share-based compensation expense of $0.3 million and $0.4 million during the three and six months ended June 30, 2024, respectively, for forfeitures related to the termination of employees. Reversal of share-based compensation expense related to the Company's restructuring efforts is included in “Restructuring expenses” in the consolidated statements of operations.

Total fair value of vested RSU and PSU awards was $1.6 million and $6.4 million for the three and six months ended June 30, 2024, respectively. Total fair value of vested RSU and PSU awards was $3.8 million and $8.2 million for the three and six months ended June 30, 2023, respectively.

The fair value of the RSUs and PSUs used in determining share-based compensation expense is based on the closing price of our common stock on the grant date.

PSUs provide an opportunity for the recipient to receive a number of shares of our Class A Common Stock based on various performance metrics. Upon vesting, each performance stock unit equals one share of Class A Common Stock of the Company. We accrue compensation expense for the PSUs based on our assessment of the probable outcome of the performance conditions. The metrics for PSUs granted during 2022 relate to our performance during fiscal years 2022, 2023 and 2024, as measured against objective performance goals approved by the Board. The actual number of units earned may range from 0% to 150% of the target number of units depending upon achievement of each year's performance

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goals. PSUs granted in 2022 vest in three equal annual installments, subject to a catch-up provision over the three annual performance targets. The metrics for PSUs granted during 2023 relate to our performance during fiscal year 2023, as measured against objective performance goals approved by the Board. The actual number of units earned may range from 0% to 150% of the target number of units depending upon achievement of the 2023 performance goals. PSUs granted in 2023 vest in three equal annual installments from 2024 to 2026.

Opco Plan

Preferred incentive units and common incentive units (collectively, “incentive units”) represent an ownership interest in Opco and are entitled to receive distributions from Opco, subject to certain vesting conditions. Opco classifies incentive units as equity awards on its consolidated balance sheets. Participation units, issued directly by Opco to Opco Plan participants, do not represent an ownership interest in Opco but rather provide Opco Plan participants the contractual right to participate in the value of Opco, if any, through either a cash payment or issuance of Class A Common Stock upon the occurrence of certain events following vesting of the participation units. Refer to Note 11 to our consolidated financial statements included in our Form 10-K where the modifications to the Opco Plan are described in detail.

Upon consummation of the VIH Business Combination, the 76,475,000 outstanding preferred incentive units and 23,219,745 outstanding common incentive units were converted into 698,934 common incentive units, and the 10,811,502 outstanding participation units were converted into 1,197,250 participation units. Opco preferred incentive units and common incentive units outstanding prior to the VIH Business Combination, as well as participation units, were not impacted by the Reverse Stock Split discussed in Note 2, therefore these amounts are presented without consideration of the Reverse Stock Split Ratio. Contemporaneously with the conversion, approximately one-third of the awards in the Opco Plan vested. The second tranche vested on the one-year anniversary of the Closing Date and the third tranche vested on the two-year anniversary of the Closing Date, although under the terms of the Opco Plan, employees who were terminated without cause after the Closing Date would vest in the unvested portion of their awards immediately upon their termination date. There has not been, and will not be, any additional awards made under the Opco Plan following the VIH Business Combination.

Unit-Based Compensation Expense

Unit-based compensation expense for the three and six months ended June 30, 2023 was as follows (in thousands):

Type of unit	Three Months Ended June 30, 2023		Six Months Ended June 30, 2023
Common incentive unit	$	377	$	919
Participation unit	(111)		27
Total	$	266	$	946

As of December 31, 2023, all Common Incentive Units and Participation Units had vested or been forfeited and there was no unrecognized unit-based compensation expense.

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Incentive Unit Activity

The following table summarizes common incentive unit activity under the Opco Plan for the six months ended June 30, 2024 (in thousands, except per unit data):

Common Incentive Units	Number of Common Incentive Units	Weighted Average Remaining Contractual Term (years)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding as of December 31, 2023	309	0.00	$	166.75	$	51,467
Granted	—
Forfeited	—
Exchanged	(5)
Outstanding as of June 30, 2024	304	0.00	$	166.75	$	50,677

Common Incentive Units	Number of Common Incentive Units	Weighted Average Remaining Contractual Term (years)	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value
Outstanding as of December 31, 2022	332	0.79	$	157.50	$	67,635
Granted	—
Forfeited	—
Exchanged	(8)
Outstanding as of June 30, 2023	324	0.54	$	157.50	$	65,980

There were no participation units granted during the three and six months ended June 30, 2023. We did not make any cash payments to settle vested participation units during the three months ended June 30, 2023. We made cash payments of less than $0.1 million to settle vested participation units during the six months ended June 30, 2023.

Determination of Fair Value

The fair value of incentive and participation units granted is calculated through a Monte Carlo simulation based on various outcomes. Opco determined that a Monte Carlo simulation was an appropriate estimation model because of the market conditions associated with the vesting of the units. The determination of the fair value of the units is affected by Opco’s stock price and certain assumptions such as Opco’s expected stock price volatility over the term of the units, risk-free interest rates, and expected dividends, which are determined as follows:

•Expected term – The expected term represents the period that a unit is expected to be outstanding.

•Volatility – Opco has limited historical data available to derive its own stock price volatility. As such, Opco estimates stock price volatility based on the average historic price volatility of comparable public industry peers.

•Risk-free interest rate – The risk-free rate is based on the U.S. Treasury yield curve in effect on the grant date for securities with similar expected terms to the term of Opco’s incentive units.

•Expected dividends – Expected dividends is assumed to be zero as Opco has not paid and does not expect to pay cash dividends or non-liquidating distributions.

•Discount for lack of marketability – an estimated two-year time to exit Predecessor awards and the six-month lock-up restriction on Successor awards is reflected as a discount for lack of marketability estimated using the Finnerty model.

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12.Net Loss per share

Basic earnings per share is based on the weighted average number of shares of Class A Common Stock issued and outstanding. Diluted earnings per share is based on the weighted average number shares of Class A Common Stock issued and outstanding and the effect of all dilutive common stock equivalents and potentially dilutive share-based awards outstanding. There is no difference in the number of shares used to calculate basic and diluted shares outstanding due to our net loss position. The potentially dilutive securities that would be anti-dilutive due to our net loss are not included in the calculation of diluted net loss per share attributable to controlling interest.

The following is a reconciliation of the denominators of the basic and diluted per share computations for net loss (in thousands, except share and per share data):

	Three Months Ended June 30, 2024		Three Months Ended June 30, 2023		Six Months Ended June 30, 2024		Six Months Ended June 30, 2023
Net Loss per share:
Numerator – basic and diluted:
Net loss	$	(35,512)	$	(50,511)	$	(56,787)	$	(95,366)
Less: Net loss attributable to noncontrolling interest	(19,088)		(33,663)		(32,198)		(64,546)
Net loss attributable to Bakkt Holdings, Inc. – basic	(16,424)		(16,848)		(