Shares of the crypto firm Bakkt fell 27% after Bank of America and Webull opted not to renew their commercial agreements.
Reasons for Stock Decline
According to a March 17 filing, Bakkt received notice that Bank of America would not renew its commercial agreement upon expiration on April 22. Additionally, it was disclosed that Webull also decided not to renew its agreement, ending June 14. These clients represented a significant portion of Bakkt's revenues, leading to a sharp drop in the company's share price.
Bakkt's Financial Status
Following the announcement of contract terminations, Bakkt's (BKKT) shares sank 27%, closing at $9.33 at the end of trading on March 18. The shares are down 96% from their peak in October 2021, when they hit an all-time high of $1063. Furthermore, the company has postponed its earnings report for the past year twice, with a new date set for March 19.
Legal Implications
The Law Offices of Howard G. Smith announced a potential class-action lawsuit against Bakkt, alleging federal securities law violations. The main reasons include the terminated agreements with Bank of America and Webull, as well as the delayed earnings reports, which resulted in the stock falling and causing harm to investors.
Bakkt is facing a challenging situation after losing key clients, which affected not just its stock position but also its overall financial and legal standing.
