Trump’s social media company reportedly in talks to buy crypto firm

Donald Trump’s social media company ended the trading day up Monday on reports it’s looking to buy crypto trading firm Bakkt.
Trump Media and Technology Group, which operates Truth Social, is close to an all-stock acquisition of Bakkt, the Financial Times reported on Monday, citing two people with knowledge of the talks.
Shares of Bakkt, backed by NYSE-owner Intercontinental Exchange, skyrocketed more than 160% and were halted multiple times due to volatility. Trump Media shares ended the day up 16.7%.
Trump Media has struggled to turn a profit, reporting earlier this month a $19 million third-quarter net loss and $1 million in revenue, but its market cap is valued at over $7 billion, thanks to its stock market performance. As of Sept. 30, the company held nearly $673 million in cash, cash equivalents and short-term investments.
“The only thing Trump Media has demonstrated they’re good at is selling overvalued equity,” said University of Florida finance professor Jay Ritter. “Now, they’ve got this big stockpile of cash, and they’re going to buy an operating business that hopefully will be able to generate revenue and profit.”
Trump Media and Bakkt ‒ whose former CEO, Kelly Loeffler, is now co-chair of Trump’s inauguration committee and married to Intercontinental Exchange CEO Jeffrey Sprecher ‒ did not immediately respond to requests for comment from USA TODAY. Intercontinental Exchange declined to comment.
A deal would help consolidate Trump’s involvement with an industry that he championed in the run-up to the U.S. presidential election. The president-elect has also launched a new crypto venture, World Liberty Financial.
“The only thing (Trump Media has) got going for them is the incoming president’s name. But the crypto crowd has backed the president quite strongly, and now they’re expecting a payoff,” said Jim Angel, a finance professor at Georgetown University in Washington, D.C.
Tuttle Capital Management CEO Matthew Tuttle warned that the crypto space is crowded, “but the market likes what they see so far” in the potential Trump Media deal.
World Liberty Financial:Trump rolls out his family’s new cryptocurrency business
Reuters reporting by Niket Nishant and Zaheer Kachwala in Bengaluru contributed to this report.