BKKT

Hello there, and welcome to Bakkt's first quarter 2026 earnings call. Joining me on the call today are Akshay Naheta, our Chief Executive Officer, and Karen Alexander, our Chief Financial Officer. Today's discussion contains forward-looking statements within the meaning of the Federal Securities laws. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those reflected or implied. We refer you to the cautionary language in our earnings release, this presentation, and in our SEC filings, including the risk factors set forth in our most recent Form 10-K and our Form 10-Q for the period ended March 31st, 2026. Today's discussion also includes references to non-GAAP measures, including EBITDA and adjusted EBITDA. Reconciliations and definitions for our operational metrics, Total Transacting Volume, Monthly Active Users, and strategic asset value are included in the appendix.

With that, I will turn the call over to our CEO, Akshay Naheta. Akshay?

Thank you, Cody, and hello, everyone. Thank you for joining us. Before I walk through the quarter, I wanted to frame the environment Bakkt is operating in because the most important point for investors right now is that we are in the early innings of a structural shift in the global payments architecture, and the ocean we are fishing in is far larger than any single competitor will capture. The global payment flows today sit in three distinct tiers. At the base, between $200 trillion-$300 trillion of annual cross-border and wholesale volume that moves across legacy rails. These rails are operational and systematically important, structurally slow, expensive, and constrained to banking hours. Above that, an application and payments layer has emerged over the past 15 years with Stripe, Circle, Chime, Revolut, BVNK, and others intermediating roughly $6 trillion of annual volume.

This layer modernized the user experience but sits on top of the same legacy rails. Bakkt Agent operates here, and the API is built on Bakkt's regulated foundation, EU presence for cross-border expansion, and on and off-ramp coverage to more than 60 countries allows for real-time automated settlements. At the leading edge, regulated market infrastructure clears approximately $2 trillion of annual volume in digital assets. Bakkt Markets sits in this space with our pan-U.S. money transmitter licenses, the New York BitLicense, institutional-grade compliance with fiat to stablecoin conversions at scale. These three tiers will continue to coexist, and our view is that stablecoin infrastructure cannibalizes legacy rails over the next several years to become the connective layer between all three. We do not have to be the biggest fish in this ocean.

The space is large enough that a regulated infrastructure provider with disciplined capital allocation, along with durable rails, can build a material business without confronting any single incumbent head-on. That is the structural backdrop that investors should keep in mind. A short tour of the field as it stands today. On peers and capital deployment over the past 15 months, three of the most significant institutions in global payments have committed cap by conducting strategic M&A transactions. Stripe acquired Bridge for $1.1 billion in February 2025. Mastercard announced its acquisition of BVNK for $1.8 billion in March 2026. ConsenSys this month is the latest data point in the same direction. These are capital commitments by institutions whose cost of capital and regulatory scrutiny makes speculative allocation structurally unlikely. On regulatory architecture, two pieces of U.S. legislation define the operating environment going forward.

Signed in July 2025, established the federal framework for payment stablecoins. The OCC and FDIC issued proposed implementing rules earlier this year. Final regulations are required by July 18th, 2026, and the act becomes substantively by early 2027 with a defined three year transition window. The CLARITY Act, the companion piece on trading and on the trading and intermediary side, cleared the House in July 2025 and is now moving in the Senate with the yield compromise resolved on May 1st. Markup expected this month and the administration targeting passage by mid-summer. Both statutes raise the regulatory bar materially. They make the licensing footprint compliance posture and settlement infrastructure that took years to assemble as the same infrastructure the laws now require. That is a tailwind for new incumbents who built ahead of the rules.

On market macros, stablecoin settlement volume reached approximately $33 trillion in 2025, up 72% from $19 trillion in 2024. Cap stabilization is at an all-time high at approximately $320 billion at the quarter end, and the cross-border payments addressable market is projected to grow from $44 trillion today to approximately $67 trillion by 2030. Whatever share of this Bakkt converts into revenue over time, the absolute size is the key point to keep in mind. The field is taking shape, the rules are being written in our favor, and the work is purely focused on our ability to execute. Before walking you through the operating segments, I want to show you, as the CEO, view our progress against the internal milestones that we've set for ourselves. The categories on this slide are subjective and are the ones that I track personally.

The ratings are my own assessment informed by the leadership team. They're qualitative, not financial, and they're definitely not guidance. Internal and the disclosure on the slide and in the appendix set out the basis on which they should be read. We've created eight categories across three bands. The foundation band categories scored at 75 or above, which is where the durable platform sits. Regulatory at 80 band, given our U.S. MTLs, the New York BitLicense, FinCEN registration, EU VASP. The infrastructure layer at 80, which includes now the DTR payment rails and settlement engine, which is now wholly in-house. Dual capabilities on the payments segment within the Bakkt infrastructure. Finally, financial strength and technology both at 75.

We have a debt-free balance sheet with $82.6 million of liquidity at the end of the quarter and continued cost discipline and efficiencies. Modular with the Bakkt Agent platform on track for a launch sometime in Q3. The in-progress band, which is in the range of 50-74, is where the work is moving but not finished. The global network at 70, with our presence in 60+ jurisdictions, gated on partner activation and regulatory closure so that we can further expand the global network. The target is to reach over 90 jurisdictions by year-end. The team and talent at 60. A+ bench under Daniel and Ankit. AI leverage operationalizing across functions, DTR integration in flight.

On the operational efficiency front, we are at 50, which is despite meaningful cost resets over the last year, there is more that can be done on this, in this area and, with further assistance from technology enablement over the balance of the year. The active focus band, which is the categories below 40, is where the priority sits, which is the partners and distribution. At 30 is the lowest score on the page intentionally so. The sales organization has had to be rebuilt, and we made progress on that front, where through the close of DTR over the next four quarters, we are about to convert the bottom of the funnel substantially into real, recognizable revenues. We're also building out our sales team, and I will delve into further details on that front as we go along this presentation.

One direct point, the categories scored highest are the ones under direct management control. The categories that scored the lowest depend on partner activations, regulatory approvals, and sales cycle conversions on calendars we do not entirely control on our own. None of those will change overnight. They will change quarter-by-quarter, and this scorecard is a framework that I will use to update you as we go along for the rest of this year. Let's go into the three engines that drive Bakkt. The business is organized around three growth engines and that framework is how we will update invest. Bakkt Markets, which is our institutional-grade infrastructure for digital assets, which allows our partners to market in a quick and efficient manner.

Second is Bakkt Agent, which is our programmable money and AI-powered finance layer, which allows frictionless, intelligible interfaces to provide full-stack banking services to their respective consumers or network. Finally, Bakkt Global, which is our international expansion and value creation, which is run on a disciplined capital-light model. Turning to our first engine, Bakkt Markets. Bakkt Markets is a B2B business. Institutional sales cycles and regulated infrastructure are measured in quarters, not weeks. Counterparty onboarding, compliance review, integration testing, and treasury approvals are the sequence regardless of how compelling the underlying product is. The work has been to establish that sequence with a credible roster of clients and convert it to live volume. The current Bakkt Markets roster comprises institutional-grade counterparties operating the regulated assets across the U.S., Europe, and Asia. Clients we expect to come on board as they grow their own businesses at scale.

Volumes come from two sources, both fee and spread businesses that scale with notional throughput. The first is trading flow. Crypto services activity routed through partner platforms and settled across our rails. The second is payments flow, which in three stablecoin flows now powered by the DTR rails, which are wholly in-house. On the product market side, the technology upgrade schedule for the second half of 2026 expands the market surface materially. More than 200 available assets at rollout, social and copy trading, a new advanced trading engine, and an improved client interface. On the commercial side, we'd like to introduce Daniel Ishak, who joins us as the Chief Commercial Officer. Daniel built and led Geyser. He ran there, which was centered around institutional B2B sales discipline, partner integration sequencing, and relationship-driven pipeline conversion, is exactly the playbook that Markets needs at this stage.

He's leading the rebuild and will be converting our pipeline into actionable revenues. I want to give an example about one of the partner activations that we've onboarded over the last few weeks, which is Zoth. In May, we signed a strategic memorandum of understanding with Zoth, a privacy-first stablecoin solutions provider built for the agentic economy across South Asia and the Middle East and North Africa. There were three components. Partner Zoth currently processes approximately $300 million in annualized total payments volume. The partnership target is approximately $1 billion in annualized TPV by the year-end 2026, according to Zoth's projections as enterprise corridors get activated over time. Second, the regulated layers throughout operate agent within Bakkt Financial Solutions, our pan-U.S. money transmitter subsidiary. The structure puts Bakkt's MTL footprint and FinCEN MSB registration around Zoth's enterprise clients.

That regulatory wrapper is the asset Zoth's clients are buying when they choose Bakkt. Third, the corridors live or activating USA to South Asia, the largest U.S. outbound remittance corridor, USA to Philippines and Nigeria, USA to the Middle East, covering the GCC expat workforce, and UAE to South Asia, the largest Middle East corridor, and sub-Saharan Africa across Uganda, Kenya, Ghana, and South Africa. The strategic point is direct cross-border stablecoin payments in emerging markets remittance by regulatory configuration. Bakkt's licensing stack is the unlock that takes commercial pipelines from pilot to production along with Zoth's regulatory coverage in these jurisdictions. A definitive commercial agreements are expected to follow in due course. Turning to the second engine, Bakkt Agent. Agent is the unit economics on each transaction are small. The cost base required to operate it is fixed and modest, and the arithmetic is straightforward.

At scale, modest take rates against fixed costs convert to meaningful net income. The execution priority is throughput, and the throughput will come from product activation increasing surface area of partners. With DTR now in-house, the payments capabilities that drive that throughput across B2B, P2P, and end user surfaces sit inside Bakkt and ramp on Bakkt's roadmap. Agent is built on four pillars. The technology, programmability, and efficiency, and distribution. On the technology front, we have a modular tech stack which is engineered to scale without the architectural debt of incumbents. For programmability, our products are built for programmable finance rather than retrofitted into it. Stablecoin issuance, redemption, and on and off-ramp logic are native to our stack.

Finally, on efficiency and distribution with our low cost to serve decoupled from linear headcount growth, our flat operating costs against growing volume converts to operating leverage, which our partner networks, whose aggregate reach extends to hundreds of millions of users, subject to definitive partner agreements and product launches. Each pillar is a deliberate capital allocation decision. We expect Agent to compound the value that it creates for Bakkt over time. The Agent commercial model has three layers. The engine is Bakkt. Regulatory rails, licenses, custody, and settlement. Our 60+ destination off-ramps and interact in more than 15 currencies across the different blockchain integrations, as well as same-day settlement, all owned by Bakkt. The catalyst is the partners. Concentrated markets where embedded distribution is available at scale, carrying trust and reach we could not replicate organically.

The value add is the utility, which is the daily use surfaces that drive volume back through Bakkt. Telecom illustrates the model. Telecom markets are concentrated. Two or three operators serve the majority of customers in most geographies. Initial launch focus is the U.S. and Europe, the embedded SIM connectivity, distribution, and utility in one motion. The eSIM API extension lets us extend the same capability to additional partners in parallel. Beyond telecom, we are in active conversations across additional verticals where the same model applies. We will share more as those are ready, activated, and announced. Finally, Bakkt Global, which is our third engine. These are markets where Bakkt is making strategic investments, where we see the long-term potential, the demographic and digital adoption tailwinds are durable, and we see a clear regulatory framework which is forming.

The two positions reported both as of March 31st, 2026. One is Bitcoin Japan Corporation, which is listed on the Tokyo Stock Exchange. It has a blended carrying value that has moved from approximately $11.5 million when we made our investment to $31.7 million at the end of the quarter. Bitcoin Japan Corporation is building its AI and Bitcoin economy and will detail its forward strategy at its upcoming AGM. On India, our position is structured through a warrant subscription in a company called Transchem Limited, which is listed on the Bombay Stock Exchange. We are still awaiting regulatory approvals on our investment into the Indian company.

Once that has been approved by the regulators, we will update further on the strategy for the company going forward. From an illustrative perspective, the mark-to-market value at the quarter end was approximately $44.3 million. The forward plan for the India position includes a broker-dealer rollout and a program of global and tokenized investments subject to regulatory timelines. The three core KPIs going forward that I believe investors should track are as follows. For Bakkt Markets, the KPI is Total Transacting Volume, the aggregate notional flow across the markets and Agents platform. In 2026, our TTV was approximately $241 million, and our year-end estimate is approximately $2.5 billion as partner integrations activate and scale.

With DTR now in-house, institutional payments volume from counterparties already integrated with the DTR stack will begin by the conference of the year. For Bakkt Agent, the KPI is Monthly Active Users, the direct measure of platform adoption, and the lead indicator for transaction frequency. Reporting begins once we've launched the product, and we will further update on guidance for the Monthly Active User as we are ready to announce the partnerships and launch the platform. Lastly, on Bakkt Global, the KPI strategic asset value, the aggregate value generated by the investment strategy incorporating mark-to-market valuations on listed holdings, cash proceeds realized, and any unrealized gains. At the end of Q1, that value sat at approximately $76 million against approximately $21 million of capital commitments across both the Japanese and Indian investments.

Strategic asset value read in accordance with GAAP and does not represent realized returns and is subject to market and foreign exchange risks. Methodology and reporting timeline for all three KPIs are set out in the appendix. With that, I will hand the call to Karen to walk over the financials.

Thank you, Akshay. The Q1 2025 comparable period in our filings reflects Bakkt as a different company. The loyalty business, divested in October 2025 and reported as a discontinued operation since the third quarter of last year, was a meaningful component of the historical cost base and a meaningful detractor from operating profitability. Stripped out, what we are left with is a clean, focused operating platform. The platform we will execute the three-engine strategy from. The numbers on this slide should be read in that light. The cost-based picture is the more useful framing, and it is the picture on the slide in front of you. Q1 2025, as reported, reflects the Bakkt of 15 months ago, with loyalty inside the consolidated cost base. Total controllable OpEx on a reported basis was $31.1 million.

The loyalty divestiture removed approximately $12.2 million of quarterly controllable operating expense from the run rate. On a continuing operations basis, Q1 2025 controllable OpEx was $18.9 million. Q1 2026 controllable OpEx was $18.6 million, materially in line with the continuing operations comparative, despite approximately $2.5 million of incremental professional services expense tied to the DTR acquisition and Bakkt Global investment activity. The line items share the same picture. Compensation and benefits, technology and communication, SG&A, and other operating expenses all decreased year-over-year, reflective of our cost restructuring efforts through 2025. On the capital position, as of March 31st, 2026, cash equivalents, and restricted cash totaled $82.6 million, principally reflecting $66.8 million of net cash provided by financing activities. The company has no long-term debt and no non-controlling interest. Two takeaways.

One, the cost base is a fraction of what it was, and on a like-for-like basis, the company is operating on the cost base it intends to scale from with further improvements to come. Two, the balance sheet is clean and debt-free, and capital is sized to execute the three engine strategy that Akshay outlined. With that, I'll return the call to Akshay for closing remarks.

Thank you, Karen. Let me close where I started. The fintech sector is large and is akin to an ocean. The sums of money moving across global payments, the rate at which stablecoin infrastructure is being adopted by the largest institutions in the world, and the regulatory architecture that the GENIUS Act and the CLARITY Act are now layering over that adoption, those forces taken together describe a structural shift, the size of which leaves room for everyone to play. We do not intend to be the largest company. This will not be a winner-takes-all sector. Any company with the right combination of technology, regulatory standing, and talent can build a material business while allowing others enough room to build their own. Bakkt, I believe, has a material advantage on two of those three dimensions today, and we are building hard on the third.

Our technology stack is modular, programmable, and now with DTR in-house, unified across markets and Agent. We believe that stack will be a key enabler in a larger share of regulated stablecoin volume as the market shifts onto the rails GENIUS and CLARITY now define. On regulatory infrastructure, our footprint across the U.S. and Europe gives us a license to operate efficiently more than 60 jurisdictions. Finally, on team and talent, we are now one team under one roof. The DTR team has joined Bakkt. With Daniel Ishak coming on as the Chief Commercial Officer, leading the rebuild of the sales organization, along with Ankit and me, product and engineering teams, we are operating as one unified platform.

We are attracting and hiring A+ talent to the company. The intellectual capital of this company has materially increased. The bench is the right bench for the stage we are in. In front of us is what we've discussed here today, volume and quality customers. With Daniel leading the commercial organization, we hope to be converting leads, closing the bottom of the funnel, and signing definitive agreements of the pipeline built over the past year. The product is now ready, the license stack is in place. The capital is in place. While sales cycles and B2B regulated infrastructure are measured in quarters, we hope to be delivering on an accelerated timeline going forward. The platform is built. At the beginning of our acceleration phase.

Excited about the opportunities ahead, and we will keep you abreast of the momentum as it builds. Thank you for your time. Operator, we are ready to take questions.

Thank you. As a reminder, to ask a question, you will need to press star one one on your telephone. To remove yourself from the queue, you may press star one one again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Mark Palmer of Benchmark. Your line is open, Mark.

Yes, thank you. Thank you for taking my questions. With regard to the closing of the DTR deal, what integration remains or needs to be done at this point? Of course, as you just mentioned, the personnel are all migrating. But what actual integration work with regard to stablecoin infrastructure in particular still needs to be done?

Thank you, Mark. With regards to the integrations, you know, there was a delay in the vote, which delayed the transaction for about four to five weeks. Be that as it may, the integration work is primarily on the compliance stack and the finance and treasury stack. Whereas most of the client-facing integrations, which are the APIs, and we're converting the APIs into SDKs that are compliant with the U.S. We need to adhere to with the regards to the U.S. MTLs.

Those are the integrations that are left because as you can appreciate that until the acquisition hadn't closed, just given the GDPR, an equivalent, you know, data protection requirements, as well as from a cybersecurity perspective, we couldn't give access to the systems and different technology stacks that were within the DTR stack to be migrated to Bakkt. Now that the Chinese wall is basically broken down, we now are able to fully migrate both the Bakkt and the DTR platforms onto one regulated compliance stack as well as ensure that all of the data and the transaction volume data is also over the next few weeks, will be able to flow seamlessly within the Bakkt systems from an accounting perspective and so on.

Thank you. With regard to regulatory approvals, obviously, you've already got a strong regulatory footprint in the U.S. and Europe. Looking at the rest of the world, what regulatory approvals are you currently pursuing, and what is the status of those?

We are not pursuing any other regulatory approval relates to payments processing business because we work with other regulated partners. Remember, all our focus is on the remittance corridor, which is we're focused on originating cross-border volume from Europe and the U.S. and focused on remitting that into work with only other regulated players, banks, payment service providers, and so on in those respective jurisdictions. In terms of regulatory, we don't need any further regulatory approvals to operate in that space. In terms of every new jurisdiction that we go into, there are very specific requirements that are needed to be. Records that need to be maintained locally with the regulated partner there as to who's sending the money and the source of funds and so on. That mechanism is built on a jurisdiction by jurisdiction basis.

So far, We're able to process transactions into 60 jurisdictions around the world, 60 countries around the world. We hope that by the end of the year, we get to more than 90 countries around the world. We are fully compliant in terms of being able to transmit the required data for processing payments within those 60 countries.

Thanks very much.

Thank you. As I show no further questions in queue, that does conclude the Q&A portion of our call and the conference for today. Thank you for participating. You may now disconnect.

Good morning, everyone, and welcome to Bakkt Holdings, Inc.'s first Investor Day, both here in person and virtually at home or in your offices. We appreciate you joining. Before we begin, please review the forward-looking statements and disclaimers in today's materials. Our presentation will include statements regarding future events, business strategy, and market opportunity. These statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. We encourage you to review the risk factors in our most recent filings with the SEC. I am pleased to introduce Bakkt Holdings, Inc.'s Chief Executive Officer, Akshay Naheta.

Welcome, everyone. This is our first Investor Day, and I want to give you a view into what we have worked on over the last year, what we have systemically rebuilt, and where we are taking the company from here. We are entering the next phase of Bakkt Holdings, Inc.'s growth with massive momentum behind us, both from a regulatory perspective as well as the economic and financial tailwinds that lie within the sector of payments and financial services. It is a precise engineered strategy that we have put together that we look forward to disclosing as we go along throughout the year. We have rebuilt our governance, capital structure, and technology. We have a great line of sight. Our pipeline is primed. The regulatory path is clear. We are rewriting the definition of category-defining deals. Today is our opportunity to show you exactly what we have built, the immense velocity at which we are moving, and why Bakkt Holdings, Inc. is positioned to lead in this category. Quick overview of the agenda for today: We will cover five areas: a quick overview of our strategy and the key drivers behind it, the market opportunity and how Bakkt Holdings, Inc. is positioned to capitalize on it, and finally, a product deep dive across our three engines, and a quick review of the year 2025, which was operationally and financially a bit volatile. But we have gone through the restructuring that we had to do. Finally, Q&A followed by my closing remarks.

The mission is simple. Build secure infrastructure and products that make money work in real life globally. It is the precise description of the problem we are solving. Money is too slow, too expensive, and too opaque for most people and most transactions worldwide. Bakkt Holdings, Inc. is building the infrastructure layer that changes that for institutions, customers, and companies. Our vision is to build the next-gen financial ecosystem, one that sits at the intersection of programmable money, regulated infrastructure, and AI-driven agentic finance. The analogy I use is that what AWS did for software—it let companies build without owning servers—Bakkt Holdings, Inc. does for finance. We provide the licensed, regulated, scalable rails so that partners do not have to build them. We have done all the work for them. The world is moving towards programmable money. Stablecoins now settle more than $30 trillion annually, and Bitcoin is becoming a treasury asset for a lot of corporates and sovereigns around the world. In the middle of all of this, you have the tokenization opportunity of real-world assets, which is moving from pilot to production in real time. Bakkt Holdings, Inc. is positioned exactly where all this is breaking out, and we are well on our way to take advantage of these opportunities. We have organized Bakkt Holdings, Inc. around three engines. These are engines because each one generates its own revenues while powering the others. Bakkt Markets is our institutional-grade infrastructure for digital assets. It gets institutions to markets faster and more safely. Bakkt Agent is our programmable money and AI-powered agentic finance infrastructure. It is frictionless, intelligent, and fully auditable. Finally, Bakkt Global is our international expansion and strategic value creation engine. We are applying our intellectual capital, technology, and products to the world's highest-growth markets through a disciplined, capital-light investment model. Critically, these three engines are complementary. Markets provides the regulated rails. Agents use those rails to move money globally; that benefits both consumers and businesses. Finally, Global leverages all of our understanding in these different areas to take it into new jurisdictions to generate tremendous value for shareholders, and early results are already showing that for Bakkt Holdings, Inc.'s shareholders. The quick accelerants: We have laid the groundwork over 2025, and we have immense momentum on partnerships that are currently underway. I have showcased a few of these partnerships here, but we are deep in discussions with several partners across the ecosystem, and we have immense momentum on that front. For Agent, we have signed up tier-one telco partnerships across the U.S. and Europe, which will embed connectivity into our fintech product. The distribution partnerships involve category-defining deals, which will improve our immediate reach and will tap into a network of our partners, lowering customer acquisition costs. We look forward to announcing significant partnerships along this line over the very near term. With Better and Zoth, we embed our APIs into their product flows, generating volume from day one. For the Markets segment, with Nexo, Ascendex, and Ubit, we help expand their liquidity and our global client base. These are all commercial agreements with real volume and real economics, and I am extremely confident in each of these partnerships and what they are going to deliver for Bakkt Holdings, Inc.'s shareholders. There are three core KPIs for shareholders to follow going forward. For Bakkt Markets, it is going to be total transacting volume between what we have—the legacy brokerage-in-a-box business that Bakkt Holdings, Inc.'s shareholders are aware of. With DTR coming into the fold, we have significantly added to our stablecoin on-ramp/off-ramp capabilities. I expect the total transaction volume within Bakkt Markets to expand substantially, and Nick will talk about it during his presentation. For Bakkt Agent, the metric is monthly active users. It is a volume business—users transacting is what drives the revenue—and MAUs are the right measure for platform adoption and distribution reach. Finally, for Bakkt Global, we look at strategic asset value—the investment and equity value our global strategy generates. In Japan, we have already made 3x our money. In India, we have made 5x our money. The methodology is internally defined and incorporates mark-to-market valuations, cash proceeds, and any unrealized gains. These are independently governed businesses in different high-growth markets, and they will also generate revenues for Bakkt Holdings, Inc., which will then contribute directly to Bakkt Holdings, Inc.'s financial statements. These three KPIs will be reported as each product and platform becomes operational. The timing is tied to launch milestones and not a fixed calendar date at this time, and full disclosure on definitions, methodology, and reporting timelines is in the appendix. Let me briefly touch upon the Bakkt Holdings, Inc.–DTR transaction. This is foundational to everything you are going to hear today. It is, in our view, a category-defining transaction for digital finance infrastructure. DTR brings us two things: products and people. On the product side, we have a composable API platform. Bakkt Agent provides cross-border payments capability and expands Bakkt Markets into stablecoin payment settlements. These are not roadmap items; they are live and ready to be deployed. DTR also brings a complementary regulatory framework in Europe. They hold the VASP license, which then sits alongside Bakkt Holdings, Inc.'s existing pan-U.S. MTL coverage and the New York BitLicense. Together, we have the regulated footprint to grow the business across both sides of the Atlantic. On the people front, the DTR team is primarily 90% engineering, and it includes our CTO, Remy, who you will hear from later today. That brings in world-class engineering talent and a proven track record of building scalable, global fintech businesses. The acquisition is subject to customary closing conditions and shareholder approval. DTR really unlocks cross-border volume for Bakkt Holdings, Inc. on stablecoin payments. This is where stablecoin technology is transformative. The TAM here is enormous. Cross-border payment flows are $44 trillion today and growing quite rapidly to about $67 trillion by 2033, according to FXC Intelligence. DTR gives Bakkt Holdings, Inc. three specific revenue hooks into that volume: stablecoin on-ramp/off-ramp fees on every fiat-to-crypto conversion, embedded financial services revenue on every flow, and a scalable compliance stack that accelerates partner onboarding, and therefore, volume. Note: the TAM figures represent the full global market, and our serviceable and obtainable market will be disclosed as we formalize specific corridor strategies. Coming to the regulatory front, we have immense tailwinds from clarity within the U.S. regulatory environment. The Stablecoin Act was signed last summer, and the Clarity Act on digital asset markets is currently moving through Congress as we speak. As the rest of the industry plays catch-up with these newly passed laws, Bakkt Holdings, Inc.'s infrastructure is already built for it, with our licenses and regulatory stack. We built this infrastructure before it was required, and that gives us a durable competitive advantage. The four-part cycle on this slide is not aspirational. It describes our current positioning—regulatory alignment along with infrastructure readiness—then helps accelerated adoption, thereby enabling scalable growth. We are in that loop today. I will now turn the call over to Nick Bays to walk you through Bakkt Markets.

Thank you, Akshay. I am Nick Bays at Bakkt Holdings, Inc. I am going to walk you through Bakkt Markets. Our institutional digital asset trading business and how we are expanding it through our partner ecosystem and the DTR transaction. The DTR transaction does not just build out Bakkt Agent; it materially expands Bakkt Markets. Three specific capability additions: over-the-counter trading infrastructure that enables higher-margin execution and larger institutional transactions; stablecoin on- and off-ramps that add payment and settlement fees alongside cross-border transaction volume; and a scalable compliance stack that accelerates client onboarding and drives revenue growth. Pre-DTR, Bakkt Markets was a spot trading and custody business. Post-DTR, it is a full-spectrum institutional digital finance platform: spot, OTC, stablecoin settlement, and cross-border payments. The revenue model expands accordingly—execution spreads on OTC, settlement fees on stablecoin flows, and onboarding-driven volume from the compliance stack. Now let us talk through the institutional digital asset trading layer. The Bakkt Markets platform has three core components that work together as a single institutional execution layer. Best bid/offer engine: We aggregate real-time pricing across multiple venues to provide clients the tightest spreads on every trade. That is institutional-grade price discovery. Order management and risk: Every order is pre-validated for minimum size, holding sufficiency, and marketability before execution. Non-marketable orders are held rather than rejected. Exceptions surface in real time. Flexible funding rails: We offer three fiat funding models. You can use Bakkt Holdings, Inc.'s banking relationships and infrastructure, you can bring your own banking infrastructure, or you can integrate with our partner, Apex Fintech Solutions, to offer a consolidated funding model across TradFi and digital assets. This allows each client to use the funding and brokerage infrastructure that fits their platform. All of this is done on credentialed infrastructure, SOC 1 and SOC 2 certified. Now differentiation in the market. We offer four competitive advantages that are difficult to replicate. Flexibility: We do not force partners into a single structure. They choose the funding rails, the business model, and the integration depth that works for them. Tech stack: Institutional-grade execution engine with real-time risk controls, built on modular APIs. The same architectural principle as the Agent platform—composable, scalable, and auditable. Offerings: From spot trade to fiat on/off ramps to cross-border stablecoin payments via DTR. Breadth of product across one regulatory relationship is unique in the market. Compliance and governance: We offer MTL coverage across all 50 states plus a New York BitLicense. When a partner works with Bakkt Holdings, Inc., they go live without navigating their own licensing. Our regulatory infrastructure becomes theirs. For fintech companies, payment providers, exchanges, and brokers who want U.S. market access, that is an enormous time-to-market advantage. Partnerships and integration: Four strategic partners, each expanding a different dimension of the Bakkt Markets platform. Nexo: We enable U.S.-regulated trading infrastructure and expand our institutional partner network, driving transaction-based revenue growth. Nexo is a tier-one digital asset lender with global institutional relationships. Their network is our network. Ascendex: Expands our global customer base and demonstrates platform demand and scalability. Recurring revenue through activity—Ascendex proves the B2B2C model works at international scale. Ubit: A consumer app that lets users spend digital assets via a Ubit-issued debit card. We power the buy, sell, deposit, and withdraw flows. Our stablecoin and on-board APIs enable bank transfer on- and off-ramps across 30+ EU and Asia countries. Lastly, DTR: Adds cross-border payments and stablecoin settlements, expands the product suite well beyond trading, and supports ongoing platform upgrades. DTR is the infrastructure layer that allows Bakkt Markets to evolve from a trading platform into a complete digital finance infrastructure. Pull the three things together—regulatory infrastructure, onboarding new customers, and growing current offerings. Regulatory infrastructure: Partners do not need to run their own licensing processes. They use ours as a plug-and-play solution. This is how we gain access to the U.S. customer base quickly. Onboarding new customers: Third-party custodians and liquidity providers expand our offering set. Durable banking relationships provide the fiat rails. These are the relationships that let us say “yes” to institutional clients on day one. Growing our current offering: Stablecoin settlement and on-/off-ramps are the new revenue layer enabled by DTR. That turns Bakkt Markets from a trading business into a payments infrastructure business. Cross-selling trading, custody, and payments from a single institutional relationship. The bottom line for Bakkt Markets: This is a high-margin, recurring revenue business that gets better as volume grows. Each partner adds liquidity into the ecosystem. I will now hand it over to Remy and Ankit to review Bakkt Agent.

Together with Ankit, we will talk through Bakkt Agent, our AI programmable finance platform.

Bakkt Agent is really built on four pillars. The technology pillar is a modular tech stack built for scale. Our efficiency layer lowers our cost to serve while volume grows without our headcount growing. Programmability: Bakkt Agent is built for the world of programmable finance—automated, logic-based money movements. Finally, distribution: we plug directly into existing networks of hundreds of millions of users. I will start with tech. This is the tech stack that makes it all work underneath our APIs and direct-to-consumer products. The tech stack is split into four main areas. We have our consumer apps at the top. We have our APIs underneath that we serve to our partners. We have our microservices layer, which is a logic engine, all tied together with a messaging bus allowing them to work asynchronously and independently from each other. Finally, at the bottom, we have a data lake that ties it all together. All the data that is generated internally and externally all falls into one place, laying the groundwork for our AI workforce to work with us. Our second pillar is efficiency. Legacy financial institutions scale headcount as they scale revenue. Our core operating model is built for automation. We have three agents that currently work at Bakkt Holdings, Inc.: Clara, which is our knowledge agent—you can ask anything to Clara about our customers, our business model, and our transactions that go through the platform. She speeds up time to answer by 98%, allowing the team to focus on growth rather than getting context. We have Lucy, who watches every transaction that goes through the platform and helps reduce our detection time by 83%. This helps us maintain our 99.9% platform availability. Finally, we have 74% of merged code contributed by AI, making sure that we speed up our delivery by over 50% without adding headcount to our engineering team. These are not aspirational metrics. These are operational numbers today, and they are a direct reflection of the groundwork that we have laid to make the right architecture decisions from the start. For our consumers, this means faster, simpler, more modular, and reliable money movements. Next, I will talk about programmability—what this means for us and why it matters now. Bakkt Holdings, Inc. is building products for a world where money is programmable. We have three composable APIs that can be used together or separately. The first one is the Zyra API, a chat-native cross-border payment interface that supports voice, text, and image inputs. It is a single API endpoint that our partners can integrate with and gives them access to our full regulated financial infrastructure. We have our Accounts API, allowing us to issue debit, credit, and savings accounts—virtual and named—in U.S. dollars, euros, and British pounds sterling. It has access to instant payment rails in all three native currencies and embeds eSIM issuance. Finally, our Stablecoin API allows payout into 57+ countries across 15 different currencies on 10 public blockchains with same-day settlement 24/7. As I said earlier, these three APIs can be used independently or composed together. Akshay mentioned Zoth—Zoth uses our Stablecoin API and our Accounts API together. Better’s integration is with our Accounts API. Talking about the two of them, Better embeds the Accounts API within their mortgage journey, allowing their mortgage applicants to deposit funds with Better from day one, helping them waive some of the mortgage application fees. Zoth uses our stablecoin financial infrastructure to enable users to more easily pay in and pay out of the Zoth app. I will dive a bit into Zyra. Zyra is the most technically sophisticated part of our stack. At the center, we have a primary agent, a large language model that is based on Google Gemini and then fine-tuned in-house. It helps orchestrate user intent between 15 different sub-agents. Those 15 sub-agents include KYC, settlement, FX, compliance, and treasury. Each specializes in its own domain and operates autonomously within its scope. At the bottom, we have a self-testing layer. This is what makes Zyra an intelligent swarm of agents. It helps analyze the input of user intent and the output that the swarm comes up with, and it learns over time, improving itself. Zyra is not just a chatbot. It is production-grade, self-evaluating, and designed for institutional-quality reliability in global payments. Now, to talk about our direct-to-consumer offering, I will hand it over to Ankit.

Hello, everyone. I am Ankit Kemka. I am the Chief Product Officer at Bakkt Holdings, Inc. Let us talk about our direct-to-consumer products. Firstly is the Zyra app, the chat-native remittance app with voice, text, and image input. It covers global money movement from the U.S. to 57 countries. It includes built-in KYC, AML, FX, and local settlements. No separate app or separate onboarding is needed. When you are using the Zyra app, it is all inbuilt. Second is our Everyday Money app. It is a full-service mobile banking app for daily use that is currently being built. It offers debit and savings accounts, debit cards, credit cards, peer-to-peer payments, simplified onboarding, and a retention-focused UX. It is a digital banking product that users come back to every day. Finally, our AI-powered loan underwriting product, which is AI-assisted underwriting and decisioning for consumer credit: faster approvals with consistent policy controls that dramatically lower cost to serve through automation versus traditional credit underwriting. Let me deep dive on the Everyday Money app. The product covers the full life cycle of a user's financial life: earn, spend, save, send, and control your finances. Customers will have access to products such as a checking account, debit cards, a credit card with a rewards program, a savings product, cross-border transfers, and, more importantly, data-driven insights across their financial life. Let me focus on the last pillar, which is distribution. The single biggest cost in consumer fintech is customer acquisition. Traditional partners spend hundreds of dollars to acquire a customer. We have solved that problem structurally by partnering with organizations that have already earned massive consumer trust. Instead of spending millions of dollars in paid marketing—which I have done before—we plug into existing networks where we can leverage owned reach. Organic reach and brand trust drive customer acquisition, and then on top of that, there are network effects that help with virality. We are extremely confident about our pipeline and are in advanced conversations with a few partners, especially for the consumer fintech platform. At Bakkt Holdings, Inc., we believe connectivity and everyday finance are intertwined. Someone with a bank account and an internet connection can go about their daily business fairly easily. Telecom markets are naturally concentrated—typically, two or three partners serve the majority of a country's population. We partner with the leading operator in each geography we want to operate in, and that gives us immediate reach through their existing distribution. With that partnership, we have embedded eSIM technology directly into our consumer fintech product. This creates a deeper relationship with our customers and higher retention due to higher switching costs. More importantly, for the consumer fintech app, owning the primary banking relationship across customers is the holy grail. Partnerships like this are the foundation of driving the primary banking relationship. Our launch focus is in the U.S. and Europe, and we have massive momentum from these telecom partners. In parallel, we are also extending our eSIM capabilities to partners via APIs. With our distribution strategy, Bakkt Holdings, Inc. is accelerating its time to scale and revenue growth. The engine is Bakkt Holdings, Inc.; we provide the regulated rails. Partners do not need to build compliance or licensing infrastructure—we provide all that. The catalyst is our owned reach that drives organic acquisition at scale through our distribution partnerships. This means we can do customer acquisition that is structurally below any other competitor relying on paid channels. More importantly, the integration provides a deeper relationship with our customers, which improves retention and lifetime value. This combination is a flywheel: low CAC, high retention, and an expanding user base. I will hand it over now to Akshay for Bakkt Markets. Thank you.

I want to now touch on our third growth engine, which is Bakkt Global. At its core, it is a capital-disciplined model of expanding our intellectual capital and technology into the world's highest-growth opportunities and markets. To be clear, this is not an experiment. This is well-thought-out, methodical capital allocation, and it is already delivering great results for Bakkt Holdings, Inc.'s shareholders. Furthermore, we are extremely confident in the trajectory ahead for this business. Effectively, we are building independently governed businesses in some of the world's highest-growth fintech opportunities. We deploy capital. We take an ownership stake and then help guide the strategic direction, products, and services into independently governed businesses. The independent governance is deliberate. It is a design choice because we do not want these to be characterized as subsidiaries. They have their own boards and management teams, and they devise their own business plans, which are guided by us. It creates accountability and credibility with all stakeholders: the shareholders, the local regulators, and the customers of these businesses. In return, Bakkt Holdings, Inc.'s shareholders derive compounding strategic shareholder value and the requisite growth as those businesses scale. We invest the money, not the infrastructure. Our products, if required, travel with us and can be leveraged by these businesses as and where applicable. It is a scalable and repeatable business model. The flywheel here is driven by the unique business strategy, which then feeds into the unique product strategy, and it is supported by independent governance and management teams. Bakkt Holdings, Inc. sits right at the center of it all, deploying the capital and receiving recurring value back. What makes this really scalable is that the product set is already built. The playbook for standing up these independently governed entities is proven, and we apply it market by market, geography by geography. These are publicly traded companies in some of the world's most attractive, liquid stock markets. We have done it twice so far: Japan, which we consummated over the summer last year, and our announcement in India in late November last year. This is the roadmap that has set both our internal expectations and how we expect these to play out going forward. I am happy to report that both of these opportunities are tracking well ahead of our internal benchmarks when we set out to make these investments. I am also looking forward to the public disclosures from these businesses in the near term, which will then shine further light on how limitless the potential scale of each underlying opportunity is. A quick update on the Japan business: it is called Bitcoin Japan Corporation. It is listed on the Tokyo Stock Exchange under the ticker 8105. We invested about $11.5 million in August, and as of mid-March, we have generated almost $37 million of returns. That is a pretty good outcome, but I think this is going to be dwarfed by what is to come going forward. Philip Lord, who is the CEO of the company, is in the crowd here today, and I am extremely confident in the leadership and the business plan that he and his team are putting together. I serve as the chairman of the board, and I have good insight into what Philip is doing to make sure shareholder money is being deployed in the right manner. Bitcoin Japan's broader strategy, as outlined on their website, is powering the AI and Bitcoin economy in Japan. At their upcoming AGM, I think Philip will be able to shed further light on exactly where he is going with this. Japan, mind you, is the second-largest market capitalization globally after the U.S., and I look forward to disclosing some of the great work that the team has undertaken in the business. Coming to India, we committed $10 million late last year. As of March, it is a 5x+ return on the deployed and yet-to-be-deployed capital. We are pending regulatory approval, which I expect in the very near term, hopefully before the end of the quarter. The strategy that has been discussed thus far in India includes a broker-dealer M&A rollout, which leverages Bakkt Holdings, Inc.'s tokenization capabilities to offer real-world assets in a tokenized format to the existing broker-dealer customers. We are extremely excited about the opportunity in India given the size of the market. It is the second-largest derivatives market in the world and one of the most exciting consumer fintech opportunities anywhere on the planet, given the size and scale of the population. We believe this investment will ultimately represent incredible value for Bakkt Holdings, Inc.'s shareholders, which, in my personal opinion, will be multiples of what you are seeing here in the very near term.

With that, what is in store for 2026? On the global side, while we continue to evaluate market opportunities where we can expand, our criteria are very high to go into any new jurisdiction. We want to have a clear high-growth strategic fintech opportunity. We need the right regulatory and legal environment that we can navigate. Finally, we need to bring in the right management team and have the right local capabilities to execute on that business plan. We are going to be very selective in how we grow this, but the current line of sight that we have with the existing investments that we have made is incredible, and we look forward to sharing more updates with you as companies make their plans public. It is good to take a few minutes to go back to what happened over 2025. I took over as CEO about four days from now to the day, a year ago. It really matters to understand where we are going forward. We have laid the groundwork to set Bakkt Holdings, Inc. up as a platform for exponential growth, especially with all of the advanced discussions and partnership opportunities that we have lined up, and I expect to announce these in the very near term. When I joined as CEO following the cooperation agreement with DTR in March, it was clear to me that we had to request patience from our existing shareholders because we needed to transform the business from the ground up, bring in the right people, upgrade the technology, and put in the right governance framework to set Bakkt Holdings, Inc. up for success in the future. On the leadership side, we brought in Ankit Kemka as the Chief Product Officer. He was the Head of Growth at Revolut and primarily focuses on Bakkt Agent. Philip Lord, who joined us as President of Bakkt International, is here in the crowd as well. When he saw the opportunity in Japan and realized how large and scalable it is, he requested that he become sole CEO of the Japan business and is now running that business for us. Thank you, Philip, for all that you did in the few months that you were at Bakkt Holdings, Inc. Finally, we are joined by the existing management team at Bakkt Holdings, Inc. that was there before I joined: Karen Alexander as the CFO, Mark DiNunzio as the General Counsel, and Nick Bays as the COO, who primarily oversees Bakkt Markets. We believe that we have now positioned the company—and the engineering team in particular—with the right domain expertise, execution track record, and alignment with where Bakkt Holdings, Inc. is really going forward. Finally, we revamped the board significantly. We added Lynn Alden, Mike Alfred, and Richard Galvin to the board. All three of them join us as independent directors, and we have Lynn and Mike in the crowd today with us. They all did their independent diligence, challenged our assumptions, and joined because they really believed in the strategy. We have now aligned the governance framework at Bakkt Holdings, Inc. in line with where we are going and the opportunity that lies ahead of us, which is one of the most important things we have done. At the end of the day, it is about people, and both at the board level and the management team level now, I feel like we are on the right path. With all of these governance and leadership changes, we have the right industry expertise and the oversight to ensure that we can deliver for our shareholders going forward. A quick reflection on the past 12 months: We did the leadership reset. We regained the focus as a digital asset infrastructure platform. We divested all non-core assets, completed the sale of Loyalty, and brought in the talent across teams to deploy the technology that we need to succeed going forward. We significantly simplified the capital structure, got rid of the Up-C structure, eliminated significant costs across the organization, recapitalized the balance sheet, and made it all debt-free. Finally, we brought in a whole new institutional shareholder base as a consequence of the turnaround and transformation story that was underway at Bakkt Holdings, Inc. We have done a full platform re-architect, positioning Bakkt Holdings, Inc. for scale through the DTR cooperation agreement, the launch of Global and Agent, and, hopefully, if shareholders approve, the DTR acquisition. I will now turn the call over to Karen Alexander to give us a quick overview of the financials.

Hello, everybody. Good morning. I am Karen Alexander, the Chief Financial Officer at Bakkt Holdings, Inc. I am going to walk you through our fiscal 2025 financials and what they tell us about the business going forward. Just to set the context, as you have already heard from Akshay, fiscal year 2025 was a year of deliberate transformation. The financial statements that you are going to see reflect that. There was noise from divestitures, restructuring charges, and some of the one-time items that we have cited. I want to make sure we separate clearly from the underlying operating performance of the business going forward. Turning to this next slide, I wanted to focus on four data points in terms of our continuing operations in 2025. The first is total revenue, which was down 32% year-over-year from $3.4 billion to $2.3 billion. Now, thinking about what this number is: substantially all of this is gross transaction services revenue. It is the flow-through number that largely offsets the crypto costs that you see in operating expenses. The gross revenue decline had two drivers: as we disclosed earlier, we amended a commercial agreement with Webull in Q1 that reduced transaction volume, and we saw lower crypto trading volume overall and asset prices through most of 2025. If you compare that to the strong market that we had in Q4 2024 post-election, that is what is going on with this revenue component. The second metric is operating expenses, which again include the cost of crypto that is an offset to crypto revenues. You see that going down from $3.5 billion to $2.5 billion, so that tracks revenue. Drilling into this trend, if you look at OpEx excluding crypto costs, that came in at $156 million. That is up by $96 million, but it is important to note that the increase is almost entirely driven by approximately $65 million of stock-based compensation related to management equity grants during this reorganization. That is a non-cash expense that we expect to recalibrate moving forward. The loss from continuing operations is roughly flat year-over-year: a $98 million loss versus a $94 million loss. But when you strip out the nonrecurring stock-based compensation I previously mentioned, the underlying improvement is real. You are going to see that in the adjusted EBITDA. Adjusted EBITDA improved from a loss of $57 million to a loss of $33 million. That is a $24 million improvement year-over-year, and I think that is the most important trend on this slide. Adjusted EBITDA improvement is driven by approximately an $18 million increase in other income, primarily related to the derivative asset and equity method investment gains associated with Japan. There was also a $12 million reduction in SG&A. This validates that the cost structure is working and that the global strategy is already contributing to the income statement.

Thinking about that as our continuing results, let us think through some of the legacy impact that we had in our 2025 financial statements that will go to zero or near zero in 2026. First off is the Loyalty divestiture. We recognized a $34.6 million net loss from discontinued operations, which is Loyalty. This is fully behind us. It does not repeat in 2026. We will have a clean continuing operations P&L going forward. The Up-C collapse: as Akshay mentioned, we felt it was important to collapse a structure that was creating ongoing drag. We incurred $26.9 million of TRA settlement costs. Most of that was paid in equity, but it was a combination of cash and equity. That will not recur in 2026. Restructuring expenses included $5.3 million of severance and platform transition costs. This is also nonrecurring. All in, what you see for the one-time legacy impact for 2025 was $66.8 million. Every dollar of this is either nonrecurring or already behind us. The headline is this: we start fiscal year 2026 with a dramatically cleaner P&L. The noise goes away, and what remains is the core operating business. So that was the cost—let us think about what that bought us. As I mentioned, the $66.8 million was deliberate. Every dollar was spent to clear a legacy drag that would have constrained the business going forward, and it does not repeat. On the three eliminated items: that $34.6 million drag in fiscal year 2025 from discontinued operations goes to zero. Loyalty and Custody are fully wound down with no recurring P&L impact. As Akshay mentioned, full-term long-term debt is fully extinguished. We have no debt service obligations or covenants constraining the strategy. Noncontrolling interest has been zeroed out with the Up-C collapse in November. Now we have one class of equity, one cap table, and full shareholder alignment. As a current snapshot into the business, we have about $88 million of cash and restricted cash as of February 2025. We ended 2025 with approximately $27 million of cash, and, as we noted, we raised $48.1 million from the February registered direct offering, plus restricted cash. In closing, we have sufficient liquidity to execute across all three growth engines we talked about today. The transformation cost was real, and it is fully behind us. We will now open for questions.

Testing. Testing. Thanks, everybody. Any questions from the audience? Mika is roaming around with a microphone. If you have any, please raise your hand, and then we will send her your way. Please introduce yourself and ask your question. Any questions? Alright. There we go. Dylan Husslin from Roth. I did not see any come through for the inbox. Thank you. Morning.

I guess, could you talk about distribution partners—what does the pipeline look like, how do you get embedded in there, and then how many end customers do they have? How do you go about going from where you are now to a much bigger base of people you are feeding your platform into?

We talked about the telco partnerships, and, obviously, our focus is the U.S. and Europe. As Ankit mentioned, there are two to three large-scale telco players in each market, and we are partnering with one of the top two or three telco players in each of those markets, which gives us a very good customer acquisition engine going forward. On the additional distribution partnerships, from a Bakkt Agent perspective, we are looking at very large networks where you have hundreds of millions of users either on the platform or already having touchpoints with these networks. The way our technology works is plug-and-play. We have done all the work. We built the infrastructure. For you to be able to launch something yourself is literally: you skin the app and launch it. Or, if you have an existing platform, you embed our chatbot within it, and you can run on our regulated rails with all of the infrastructure and piping at the back to launch a fully fledged fintech platform. We are in very advanced discussions on some category-defining deals, and, in the very near term, I look forward to updating you once we are ready to do so in accordance with SEC regulations. I hope that answers your question.

Thank you, Dylan. Any other questions from the audience? No? And Marni from Macquarie as well.

Good morning. This is Marni Lysart from Macquarie. I guess it would be good, when we think about the pipeline, to get a bit more color on how you navigate the regulatory landscape. You have called out trying not to have the operating structure encompassing subsidiaries. How do you approach that as you evolve?

The regulatory landscape is a two-part vector. One is Bakkt Global: these are independent companies in their own jurisdictions, and they follow the regulations and laws in those local jurisdictions. Bakkt Holdings, Inc. does not have anything to do with what is happening in India or Japan, in the sense that those companies focus on the local regulatory environment. That is straightforward and clear. In terms of Bakkt Agent and Markets, we have the pan-U.S. licensing coverage. Similar to our brokerage-in-a-box business, which we have been doing for over five years—even before my time—we have leveraged that business model, which has been approved by regulators, and transferred it over to the Agent side, which is almost the same thing: you on-ramp and off-ramp. The only capabilities that you are adding on top are cross-border payments. Ankit talked about our capabilities to do near-instantaneous settlements in over 57 countries, which I expect will get to over 90 countries by the end of the year. There, we work with local regulated financial institutions—banks and payment service providers—who have their own local requirements. They conduct KYC/AML from their perspective. We ensure that we cover those on our side, and, so far, we have successfully done it for almost 57 countries. I do not see any problems with us getting to 90 by the end of the year. Does that answer your question?

Yes, that is clear. Thanks for answering my question.

We have one more here. Thank you.

Good morning. Jared Watson from Retail. Thanks for taking my question. Akshay, you have talked previously about wanting Bakkt Holdings, Inc. to compete in the public markets. Has that and the capital you raised and the balance sheet been a competitive advantage in partnership discussions, especially when some of your competitors are private? Thank you very much.

It has made a big difference because, when I joined Bakkt Holdings, Inc., the big issue was that people were concerned about having their deposits or customer deposits sitting at Bakkt Holdings, Inc. Even though it is all segregated and is held within our trust, and we cannot commingle funds or use them, recapitalizing the balance sheet has helped materially with these customers and partners. From an ongoing business perspective, no one wants to do all of the integrations with a company and then face uncertainty around the financial stability of the business going forward. That has been a big driver of instilling confidence and helping us drive an active pipeline on the B2B side. As we go into stablecoin on-ramp/off-ramp payments, you will see it unfold pretty exponentially as we go through this year because the volumes on pure stablecoin on-ramp/off-ramp cross-border payments are in the billions. Even though you do not take any financial risk or hold customer funds because it is instantaneous, people want to make sure that you have a strong balance sheet to have the confidence of working with you as a counterparty. So, yes, it has helped tremendously. Thanks.

I have one more from Darren at home. Thank you, Darren. For Akshay: given you founded DTR, can you speak to why it was necessary to fold it into Bakkt Holdings, Inc.? Also, double-click on the benefits that DTR brings to Bakkt Agent, near term and long term.

I will have Ankit and Nick answer in a little more detail so you hear it from the people who are executing and touching the technology day to day. Just to rewind, it was always the intention for DTR to be folded into Bakkt Holdings, Inc., subject to shareholder approvals. The transaction was put together in March. I joined as CEO, and I was not sure, given all of the clouds around Bakkt Holdings, Inc. with the Loyalty business—I did not have any experience running a Loyalty business or a call center business. Until that business was hived off, I did not know if this would be the right focus, because my focus is fintech and the changing financial landscape going forward. It made sense for both companies to get into a cooperation agreement-type partnership. Now that the Loyalty business is behind us, and given all of the opportunities with the distribution pipeline that we have in very late and advanced stages, the independent committee and the board thought that it would make economic sense for these companies to come together to provide those services in a seamless manner to end customers. Nick, do you want to add color on the Markets side, and then Ankit on Agent?

My pleasure. Now that we are done with the prepared remarks, I can tell you how exciting it really is to have DTR in the fold. Working in the space of our Markets business, we were primarily focused on spot trading. That business is durable, resilient, and still valuable. But what we have seen in the space, and in talking to prospects over the last couple of years, are questions around stablecoins, payments, and cross-border. They saw our regulatory footprint and said we could power them. We were trying to figure out how our existing technology could power them, and there were a lot of rough edges. It was difficult to convince prospects to partner with us on that capability. Through the DTR commercial arrangement over the last nine months, we have already done integrations to help power these things. We are ready to go and are already ready in the U.S. to offer that capability. Now, when those prospects come to us, we do not have to turn them away, which is really exciting. We can also collapse a lot of overlapping technology, with synergies that let us consolidate onto a more modern technology stack. That has been really transformative, and we are looking forward to taking that out to market in the next couple of months. Ankit, do you want to talk about Agent?

The Bakkt Agent product is built on the tech stack from DTR. It is built from the ground up. Two examples: The Zyra app, which is a global money movement solution, is using everything that DTR has built and then adding agents on top. It is fully integrated. Second, the Everyday Money app: if you remember the modular tech stack that Remy showed, that is exactly how we have built the Everyday Money app. We have taken different product features—each built independently and modular—and they all connect for the fintech consumer platform we are building. It has been instrumental, and the way we have built this is very scalable. It can work across geographies and across platforms. It is pretty cool stuff.

We probably have time for one more here from Paul Golding, also at Macquarie. He is asking: how are you viewing the competitive landscape around stablecoin enablement and your relative positioning?

There are two segments: Bakkt Markets and Bakkt Agent. On the Bakkt Markets side, my view is that the architecture of payment systems is going to change dramatically over the next few years. You are already seeing some very large M&A transactions happen. We are aware of what our competitors are doing in the space, but the scale of the opportunity in payments is so large that doing tens of billions of dollars of volume is a drop in the ocean given the $44 trillion of cross-border payments today. Once we have all of the capability that Nick talked about within the Bakkt Markets platform, you will start seeing us sign larger clients. We are already seeing very good results with Nexo. I think Zoth will also go live over the next month or so, and the volume will scale rapidly now that we have fully integrated the DTR tech stack on the Bakkt Markets side. On the Agent side, competition boils down to distribution. Providing products in a cost-efficient manner—we have done that through our tech stack, with very little human intervention throughout the stack, from onboarding to accounting to compliance to money movements to treasury management, and so on. You go to any neobank or fintech out there—Chime, Revolut, and others—and with Ankit being at Revolut for so many years, we have a lot of insights into that space. It is about distribution partnerships. We have taken a thoughtful approach where we do not have to spend hundreds of millions of dollars like these companies did and be loss-making for years. We will be able to scale rapidly to a large number of monthly active users without spending that kind of money. That is why, when we launch with the right distribution partners in the very near term, MAUs will be one of the metrics to follow closely.

Thank you. I wanted to hand the mic over to a member of the board, Mike Alfred. Would you like to say anything? Okay. That is all the questions, then. I will pass it back to Akshay for closing remarks. Thank you.

In closing, 2025 has been a year where we have laid the groundwork. There was a lot of heavy lifting. It was not easy along the way, especially with divesting the Loyalty business. We have stripped away the noise, rebuilt the foundation, and I believe that Bakkt Holdings, Inc. is now well positioned to compound long-term shareholder value. Ninety percent of the structural work is behind us at this stage. We are also at a very interesting time in the world. Periods in which the architecture of money changes are very rare, and I believe we are in one of those periods today. I thought we were in that period three years ago when I left SoftBank to start DTR. There were structural forces shaping my thoughts around where financial infrastructure was moving. One was geopolitics: we had many years of peace, and with the Ukraine–Russia war starting in early 2022, that landscape changed dramatically. Over the last few weeks, it has changed again. The second is global debt levels: even back in 2022, fiscal debt levels were at all-time highs. You have not seen that level of global debt in peacetime. Given the global debt levels across major economies and the geopolitical backdrop, this will reshape the architecture of money. These new digital systems—primarily stablecoins—are going to redefine how value is stored, transferred, and programmed. The growth we are seeing in artificial intelligence will be a dramatic driver in how the software stack is structured in all financial institutions going forward. We have positioned Bakkt Holdings, Inc. at the center of it all, and we do not have any legacy technology debt to tackle this because we built everything from the ground up. Bakkt Holdings, Inc. sits at the intersection of these incredible changes, and I believe that we will be able to take significant advantage of the opportunities ahead. Looking ahead into 2026, we have built significant momentum. We have announced, or are very close to announcing, some very large partnerships. The discussions are progressing. We are in advanced conversations, and we expect aggressive growth at Bakkt Agent through the adoption of monthly active users on the platform. We have a clear line of sight. What lies ahead is a period of disciplined execution. We have the right team in place to do that, and this will translate into long-term value for shareholders, I believe. I thank our existing shareholders before I joined the company for their patience, and I believe that, if they stay on with us, they will be rewarded along with us for the journey ahead. Thank you so much for your time today. We appreciate you joining us in person today. Thank you.

Greetings, and welcome to the Bakkt's Third Quarter 2025 Earnings Conference Call. [Operator Instructions]. As a reminder, today's program is being recorded. I will now turn the call over to Cody Fletcher, Investor Relations Adviser at Bakkt. Please go ahead.

Hello, everyone. And thank you for joining Bakkt's Third Quarter 2025 earnings call. Before we get started, I'd like to remind everyone that during today's call, we may make certain forward-looking statements. These statements include, but are not limited to, our expectations regarding Bakkt's transformation into a pure-play digital asset infrastructure company, the performance and future development of our Markets, Agent and Global, our international expansion strategy, including anticipated actions related to our Japan investment and future jurisdictions, our plans for platform upgrades, cost optimization, hiring and brand initiatives, expectations regarding the StableCoin, Bitcoin and tokenization markets and our outlook for 2026 KPIs in our planned Investor Day. These statements are based on management's current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. For additional information regarding forward-looking statements and risk factors, please refer to our filings with the Securities and Exchange Commission. Further, in addition to discussing results that are calculated in accordance with generally accepted accounting principles, we will also make reference to certain non-GAAP financial measures. For more detailed information on our non-GAAP financial disclosures, please refer to our full earnings release, which can be found on our Investor Relations website. Thank you. And I will now turn the call over to Akshay.

Thank you, everyone. Thank you for joining the call. Today, our focus is around one clear mission to power the next generation of global finance. That clarity of purpose matters. It allows us to align our people, sharpen our strategy and channel our resources with conviction towards the future we see emerging. Across the world, individuals and institutions are reevaluating what money really is, how it moves and how markets operate. We believe this shift will define the next era of global finance, and we see it unfolding across 3 major fronts. First, Bitcoins continue to rise as a globally recognized digital store of value, the new foundation for trust and savings. Second, the rapid transformation of banking and payments accelerated by AI and stablecoins, which are reshaping how value flows through the economy. And third, the tokenization of real-world assets, redefining how everything from bonds to commodities to property is traded and settled in the future. Bakkt stands at the center of this evolution, building the compliance, secure and scalable infrastructure that enables these systems to connect and grow. Our vision is simple, yet bold, to be the trusted bridge between the physical and digital world of finance, enabling seamless value transfer as society accelerates into an AI-driven economy. If we take a step back, it's clear the evolution of global finance is already underway, and the scale of opportunity is extraordinary. Out of an estimated $700 trillion in global assets, only a small fraction currently live on blockchain rails. That's rapidly changing as digital infrastructure becomes increasingly integrated into traditional systems. Bitcoin continues to gain acceptance as a credible treasury asset among corporates, sovereigns and institutions. Stablecoins, meanwhile, now settle over $30 trillion annually surpassing Visa and new policy frameworks such as the U.S. Genius Act, are establishing clear regulatory guardrails that legitimize this market. At the same time, tokenization is moving from pilots to production. Financial institutions are beginning to issue and settle assets on programmable rails with BCG forecasting nearly $19 trillion in tokenized value by 2033. The takeaway, the total addressable market for digital asset infrastructure is enormous, and we are still in the very early innings. Bakkt is positioning itself at the center of this transformation with a regulated rails custody and settlement layer that will power this ecosystem. We are aligning our capital talent and road map to deliver tangible outcomes shaped by these powerful global trends. This quarter represents an important milestone in Bakkt's journey. We delivered strong results with $29 million in adjusted EBITDA, which demonstrates the scalability and efficiency of our evolving business model. On the balance sheet, we closed the quarter with approximately $64 million in cash and restricted cash and no debt, reflecting disciplined execution and a significantly strengthened financial foundation. While I'm pleased with these results, I want to be absolutely clear, this is just the beginning. The heavy lifting of our transformation is largely behind us, and I expect to complete the process by the end of Q4 as the elements of our restructuring, product launches, distribution partnership and cost initiatives all start coming together. This quarter also affirms the strength of our Bakkt Global business model, a framework built for durability and scale. It validates the structural and strategic changes we made are already translating into tangible performance. And as we look ahead, I'll walk you through the decisive actions we've taken since I became CEO, what remains in our road map and how Bakkt is uniquely positioned to power the structural rearchitecture of global finance. When I stepped in as CEO following the Cooperation Agreement with DTR, Bakkt was spread too thin, a collection of disconnected initiatives burdened by noncore assets and inefficient cost structure and a lack of strategic focus that had built up over years of missteps. We acted with immense urgency. Over the past 2.5 quarters, we've executed a disciplined and deliberate transformation, one that touched every part of the business. We exited noncore operations, reconstituted the Board, streamlined our organization and refocused entirely around one mission, building a leading regulated digital asset infrastructure platform. We rebuilt Bakkt from the ground up, simplifying our technology stack, reducing external dependencies and attracting top-tier talent to lead our 3 core verticals. Bakkt Markets, Bakkt Agent and Bakkt Global, which I'll discuss shortly. We also strengthened governance and leadership. Phillip Lord, our President of International, is driving our expansion across Japan, Korea and India, connecting us to some of the world's most dynamic capital markets. Ankit Khemka, our Chief Product Officer, who was the former Head of Growth at Revolut is accelerating innovation and integration across our products primarily on the stablecoin front. At the Board level, we previously welcomed Mike Alfred and Lyn Alden, and today, I'm very pleased to welcome Richard Galvin, 3 deeply independent thinkers and accomplished entrepreneurs. These are not professional "directors" collecting fees. Each conducted their own diligence, challenged our assumptions and joined the Board after gaining conviction in our vision, our road map and the integrity of our transformation. That engagement brings institutional discipline and intellectual rigor to Bakkt's covenants, not box sticky. We eliminated structural overhangs, significantly reduced costs and strengthened our balance sheet. Today, every dollar we spend is driving monetization through trading spreads, custody fees, stablecoin flows and recurring revenues. This has not just been a cleanup exercise but instead a full-scale reboot of the company that is now ready for the exciting disruption currently underway for the next few decades of finance. And we did it at what many would consider lightning speed. As we approach the end of Q4, our transformation enters its final phase. From here the focus shifts from transformation to acceleration, integrating our platforms, expanding our regulated custody and advancing strategic partnerships across markets and stablecoin infrastructure. A key milestone this quarter was the simplification of our capital structure. In Q3, we announced, and on November 3 close, the collapse of our Up-C structure, eliminating the dual-class share system that dates back to our deSPAC in 2021. That structure serves its purpose early on, but over time, it's become a total drag. It added complexity, reduced liquidity and created friction for institutional investors. With the Up-C collapse complete, Bakkt now operates as one company, one cap table, one mission. Shareholders, management and employees are now aligned under a single corporate entity, a major step forward in transparency, governance and shareholder alignment. We also strengthened our balance sheet. Between Q2 and Q3, we raised roughly $100 million in new capital and eliminated all outstanding debt giving Bakkt a cleaner, stronger financial foundation. We carry more than $120 million of tax loss carryforwards, a valuable asset that will offset future taxable income as profitability scale. To underscore my own conviction, I personally invested about $1.5 million in Bakkt shares in August through open market purchases. And as of October 31, shareholders have authorized me to purchase up to 13.4 million more stock through an option plan. I view this not as a signal, but as a statement of belief. I'm fully aligned with our shareholders for the long term. And let me make one point very clear, Bakkt is not in the business of perpetual equity issuance. We are not "a digital asset treasury vehicle" chasing exposure through dilution. We've turned the corner financially, debt-free, disciplined and focused. Any future capital raising will be done strategically, selectively and with a deep respect for shareholder value. This new structure and capital position gives us the flexibility to pursue opportunities, but always with the discipline and alignment that shareholders expect and that I personally demand. With our foundation reset and capital structure simplified, we are now focused on what defines Bakkt our 3 growth engines: Markets, Agent and Global. Bakkt markets is the foundation. It provides institutional-grade infrastructure for digital assets, connecting clients to liquidity, market-making and regulated custody through our nationwide money transmission licenses and New York BIT license. This is how institutions trade on Bakkt, compliant, efficient and secure. Bakkt Agent is how money moves. It's our programmable finance platform, combining stablecoins, AI agents and cross-border payments into one seamless system, making sending, spending, saving and transacting as easy as messaging. This positions Bakkt at the heart of the stablecoin adoption wave and global remittance demand. Bakkt Global takes our technology into new jurisdictions through a minority investment model designed to generate investment gains and our long-term recurring revenue. We started in Japan where early progress in validating the model, and we'll share more updates as it scales in the quarters ahead. Together, these businesses form a unified regulated digital asset company, connecting how markets trade, how money moves and how value is stored. Let's start with Bakkt Markets, our core business, the engine of our infrastructure and the foundation of how modern digital markets will eventually trade in my opinion. This division is primarily U.S.-based and built around a simple but powerful flywheel, market infrastructure, balance sheet strength and regulatory licensing, each reinforcing the other as volumes grow and liquidity deepens. Our regulated core is anchored by MTL licenses across the U.S. and our New York BIT license. It's designed for institutional-grade performance, offering deep liquidity, stablecoin on and off ramps, OTC trading and secure custody through the new partnership of Bakkt ICE Storage with Intercontinental Exchange scheduled to launch in Q1 2026. We are also expanding through Bakkt FX and evolution of our brokerage-in-a-box business. It provides a single point of access for B2B2C clients to route, trade, settle and custody assets, serving exchanges, fintechs and brokers that want to operate compliantly in the U.S. without building the regulatory stack themselves. Together, these elements make Bakkt Markets, the engine room of our platform compliant, connected and built to scale. Next, Bakkt Agent is how money moves seamlessly, intelligently and globally. Stablecoins have become one of the most disruptive forces in modern finance. They're reshaping how money is stored, sent and earned at a fraction of the cost of legacy rails. Bakkt Agent is our response, a programmable finance platform operating behind the scenes as the AI-driven architecture powering the next wave of digital banking. Under the hood, Bakkt Agent is an AI-first modular stack, built from the ground up. Multiple AI agents coordinate workflows across payments, compliance and treasury, integrating with partner banks, card networks and payment providers worldwide. The result is a white label customizable foundation that allows any partner to launch a neobank grade experience quickly and compliantly. Rather than building a direct-to-consumer business, our model is distribution partnerships driven and asset-light. Partners embed Bakkt Agent into their products, leveraging our licensing coverage, global partnerships and modern APIs without the heavy integration costs. Through our conversational interface, Zaira we are starting with cross-border remittances, a nearly $850 billion market, where consumers still pay up to 7% fees. Bakkt Agent enables faster, cheaper and more intuitive transfers built for scale. At its core, Bakkt Agent is the programmable financial stack unifying global money movement, rewards and AI-driven finance into one seamless platform. We expect to announce significant distribution partnerships in the near term as we move to a scale rollout in the quarters ahead. Bakkt Global is where our infrastructure model meets international scale, enabling entry into high-value markets while compounding long-term shareholder value. At its core, Bakkt Global may give our shareholders look through exposure to Bitcoin through publicly listed entities and select jurisdictions if those entities decide to pursue a strategy to hold Bitcoin on their balance sheet. When these entities deploy capital into Bitcoin, Bakkt earns recurring custody and management fees by being the lowest cost regulated provider to these entities, while our shareholders indirectly participate in Bitcoin upside. Each of these entities will maintain independent governance and boards to ensure transparency and credibility. Our first investment is already underway in Japan for which the EGM is set for November 11 and where we expect the company, Bitcoin Japan Corporation, to outline its strategy. This model deliberately extends our markets and agent infrastructure globally, enabling us to own minority stakes in high-potential jurisdictions, expand our footprint, compound fee income and generate recurring revenue, all while maintaining discipline on capital intensity. As we look ahead for 2026 KPIs, I want to provide a clear view of how Bakkt makes money going forward ahead of the Investor Day scheduled for some time in Q1 2026. Our model is diversified, recurring and designed to compound as we scale dramatically over the coming quarters. Across markets, Agent and Global, each vertical contributes revenue streams, each reinforcing the other. Bakkt Markets generates B2B and B2B2C revenue through market-making OTC spreads, trading volume and lending fees, the core liquidity engine of the platform. Bakkt Agent earns stablecoin on-ramp, off-ramp revenue from transaction volume, spreads and FX conversion, powered by our AI-first architecture and embedded through distribution partnerships. Bakkt Global adds licensing, management fees, NAV accretion and investment gains from our minority holdings in international partners. Together, these form a resilient multilayered revenue engine where Markets provides liquidity, Agent drives stablecoin and payment flows and Global expands our reach into new jurisdictions that can amplify both. As we look across our milestones for the fourth quarter, our goals are clear: Bakkt aims to complete its transformation while strengthening the core engine that will position us to drive growth in 2026. Everything we've done, the operational reset, technology upgrades and cost optimization moves in one direction towards a leaner, faster and more disciplined platform built for scale and sustained profitability for which we've already seen the green shoots in this quarter's results. At the same time, we're expanding our reach across all 3 growth engines. In Markets, we are driving customer growth, completing key technology upgrades that will enhance liquidity and trading performance. For Bakkt Agent, we are opening new distribution corridors and advancing partnerships that will expand our stablecoin and cross-border flows and through Bakkt Global, we are extending our infrastructure into additional jurisdictions beyond Japan continuing to do so in a capital-light disciplined manner. We are also staying focused on the foundation, continuing to fine-tune our cost base, bringing in exceptional talent and rolling out the refreshed brand and website much needed that will reflect who we are today. As we released our 2026 KPIs and prepare for our to-be-announced Investor Day in Q1, shareholders will have a clear line of sight into how all these pieces come together into one cohesive strategy. And if we keep with the baseball analogy, I've been using on X recently, it feels like we are at the top of the ninth. The transformation innings are nearly behind us. Now it's about execution, closing out the quarter cleanly, staying focused and finishing strong. By December 31, I'm feeling quite confident sitting here that we'll be able to look back and call this turnaround complete at that time. With that, I'd like to hand over the call to Karen Alexander, our CFO, for a deeper dive into the financials. Karen?

Thank you, Akshay. Before I get into the numbers, I want to acknowledge that this quarter still reflects some residual impact from our Loyalty business, which remains part of our results through year-end 2025. This means you'll continue to see some accounting noise as we report both continuing and discontinued operations. While this may make the GAAP figures appear uneven, the underlying economics of our core digital asset business are much clearer when you look at our adjusted metrics. As a reminder, beginning in Q1 2026, once Loyalty is fully behind us, our financial reporting will be clean and directly aligned with the diversified revenue model, Akshay, outlined earlier. For the quarter, total GAAP revenue was $402 million, up 27% year-over-year, primarily driven by higher crypto trading activities. Crypto costs and execution clearing and brokerage fees increased proportionately consistent with volume growth. Operating expenses, excluding those costs, were roughly flat at $26.7 million, reflecting lower compensation and SG&A following restructuring initiatives. Excluding about $5 million of nonrecurring restructuring charges, operating expenses would have declined by over 18% year-over-year, demonstrating continued cost discipline. As a result, adjusted EBITDA reached $28.7 million compared with a loss of $20.4 million in Q3 2024. And adjusted net income from continuing operations was $15.7 million. These measures better represent the earnings power of our digital asset infrastructure platform. They exclude discontinued operations and onetime noncash items, such as fair value changes and warrants, allowing investors to see the true progress of our core business. We expect the remaining transition noise to taper through year-end by Q1 2026, Bakkt's financials will be -- will fully reflect the leaner, more focused company we've rebuilt with clear visibility into sustainable growth and profitability. Turning to the balance sheet. We ended the quarter with $64 million in cash, cash equivalents and restricted cash and importantly, no long-term debt. As we complete our transformation, this balance sheet reflects a disciplined financial foundation, strong liquidity, no structural overhangs and sufficient flexibility to support both near-term commitments and future growth. We expect to use a portion of this cash in the fourth quarter to close the Loyalty divestiture and fund working capital, as we complete the transition to a pure-play digital asset platform. In our financial statements this quarter, you'll also notice the inclusion of current and noncurrent assets held for sale, which represents the Loyalty business and associated balances. Upon closing, these will roll off the balance sheet, leaving behind a streamlined digital asset infrastructure company that clearly reflects the economics of our continuing operations. Our focus remains on maintaining a resilient and efficient balance sheet, ensuring that we have the liquidity and flexibility to execute on our road map, pursue strategic opportunities responsibly and continue delivering long-term value for shareholders. With that, I'll hand it back to Akshay for closing remarks.

Thank you, Karen. To reiterate, this quarter marks another important step forward in Bakkt's transformation. As we move through the fourth quarter, you'll begin to see the changing of the guard, a new Bakkt taking shape. What's emerging reflects the culmination of a year of tough decisions, disciplined execution and the establishment of a foundation built for scale and long-term profitability. The heavy lifting is largely behind us, and the momentum heading into 2026 is not just exciting, it's real. The structure is now in place. The strategy is clear and the alignment across our people, partners and shareholders has never been stronger. Over the coming weeks, we'll work to finalize the remaining elements of this transformation. And by the time we speak again, I'm confident Bakkt will have completed its restructuring phase and will be operating with a clear line of sight to sustain profitable growth in 2026 and beyond. To our partners, our customers and especially our shareholders, thank you for your continued trust, patience and belief in what we are building. That concludes our third quarter 2025 earnings call. I'll hand it back to the operator.

[Operator Instructions] And our first question comes from the line of Chris Brendler from Rosenblatt Securities.

Congrats on the progress here. I'd just like to think about the business as it stands today? And maybe, Akshay, if you could sort of give us a little more insight on to the core offerings on the sort of the brokerage side? And how that might compare to Bakkt Zero Hash is offering? I think that's been a pretty major transaction in the space. And it feels like they're kind of similar to what Bakkt is doing, but I feel like I'm not quite sure where all the dots connect and how this sort of fits from a competitive standpoint. So maybe you could help me with that sort of area of questioning sort of how is Bakkt compared to Zero Hash?

Sure. Look, I think as far as Bakkt and Zero Hash, the direct comparison is concerned, I think we're both looking at being the picks and shovels layer, the regulated infrastructure that lets the ecosystem operate securely and at scale. I think there are lots of similarities and comparisons on that front. And as you can see, I think there is a lot of talk around stablecoins and the new payment rails these days. And so from my perspective, when I look at everything that's happening in the space from the recent M&A activity, whether it's Zero Hash and others as well as private market valuations in the space, you can really draw your own conclusions in terms of what their value is relative to Bakkt, et cetera. But I think that, look, we bring a pretty similar product suite just on the Bakkt Markets business relative to Zero Hash, except that we are doing this in a public setting where we plan on doing it without any heavy burn and not chasing top line volume and revenue growth, which is not profitable and doing it in a disciplined manner. So that's my perspective on this from what I know.

Okay. Great. Very exciting. Towards the back of the slides on your milestones. #9 is release KPIs for 2026. I'm not looking for a sneak preview of what your targets are. But what are the key KPIs? If you can talk about them at this point, just sort of what should we be following here to monitor the progress on the new Bakkt?

So look, that's the reason why I laid out the slide earlier because I knew that there would be this question around key KPIs for 2026. And the slide earlier gives you exactly how we look at our business in terms of how the revenues are generated and how that all flows down to the bottom line. And so I would just say that in terms of KPIs, I think it will be driven from each of these 6 different boxes that I've highlighted. And the key variable for each of these boxes to actually make money and for it to actually flow down into revenues and then finally into profit. So I think when you look at Bakkt Markets, as an example, it will be around trading volume and the spreads that we are generating -- spreads and fees that we're generating, which then flows down to revenue. So that's very straightforward. On the Bakkt Agent side, I think you'd look at something around stablecoin transaction volume and the combined blended spread and FX conversion rates that we are making on that front. And when it comes to Bakkt Global, I think you're looking at 2 aspects of it. One is the NAV accretion of our investments that we are making because that's -- all of the investments that we're making are booked based on an equity method of accounting. So for example, our $11 million investment or so in Japan is today worth significantly higher than that, but we haven't put it through the P&L statement. And so that's something that sits on our balance sheet marked that at -- sorry, at our cost value. But -- however, depending on -- as I mentioned in my prepared remarks, depending on whether these companies, that we invest in, decide to go and pursue a Bitcoin treasury strategy or want to leverage some of our technology and license that, then there will be additional licensing and recurring revenue in terms of revenues that we'll end up generating. And I think we'll give you more color on all of these fronts as we go ahead and release the KPIs for 2026.

And our next question comes from the line of Mark Palmer from Benchmark.

I know you touched on this during your prepared remarks, but just wanted to dig into it a little bit more, can you talk about the role of partnerships, joint ventures on the one hand and M&A on the other as potential accelerants of each of the company's strategies?

So we are very focused on organic growth, Mark, for the moment. And so I can't really speak too much about M&A because we really haven't thought about that. But in terms of distribution partnerships, as I said, we are -- we've been hard at work to work on these distribution partnerships. In my prepared remarks, I alluded to the fact that we expect to have something that we can publicly share with everyone over the next -- over the coming quarter or two. And I think that is actually one of the gating factors for actually releasing the KPIs because until we get this in hand or are very close to doing it, we don't want to go out and release the KPIs. So our model is to grow through partnerships because that's the best way to grow. We don't want to be consumer-facing directly. I think that costs a lot of money to go out and expand and spend the money on customer acquisition costs. And so we will definitely continue pursuing a distribution-led partnership model to get the volumes onto the platform, and we look forward to updating everyone as and when we are ready to announce these partnerships publicly.

Congratulations on the progress.

Thank you.

[Operator Instructions] Our next question comes from the line of Justin Pan from Clear Street.

It's Justin on for Brian. Obviously, a ton of exciting work over the past quarters on [ deploying ] the structure of the business and paving a clear path for next year. I guess when we think about '26, what are some of the considerations on both the macro and the policy side you would call out that would be both potential tailwinds and headwinds to growth as we think about the outlook for 2026?

I mean, the most exciting thing is the CLARITY Act that's hopefully going to get passed soon, certainly, hopefully, next year. I think that's a very exciting development for us. And just getting the regulatory clarity as it relates to real-world asset tokenization is a big opportunity for us in general. Other than that, I think not much else on the policy front in the U.S. I think the administration has already paved away. And from day 1, they've declared their intention to make sure that America becomes a crypto capital of the world. And increasingly, it's already -- if it hasn't already become that, it's definitely well along its way to become that. I think the other thing that's very exciting is looking at all of these very large financial institutions getting their sleeves rolled out to participate in the stablecoin space because we are the picks and shovels, and we are stablecoin agnostic, and I just see a very, very bright future in terms of volume growth, cross currency, stablecoin FX-related growth and so on. And so we built a business which is ready to take advantage of all of those opportunities that lie ahead of us. And like I said, we're very early in the story, very, very early innings for what's to transpire here over the next several decades. So that's my view.

Got it. That's helpful. And just one more for me. You talked a bit about your international expansion model, beginning with Japan. I guess could you touch on some geographies that you're focused on next? And what's the strategy for scaling beyond the U.S. and Europe?

I think the model is the same. I explained it in my prepared remarks. But I think, look, you're going to hear from the company in Japan tomorrow, there is the EGM tomorrow. And I think it will become clearer as to what that company's strategy is going forward. The other jurisdictions that I alluded to in my prepared remarks are South Korea and India. And again, the idea will be to see what we can leverage on the markets and agent infrastructure side to grow in these high potential jurisdictions and expanding our footprint, so that we are very focused on our core market, which is the U.S., but then these companies are leveraging either our product services or technology to then grow, but then also give back some licensing and other revenue back to Bakkt.

If there are no further questions from analysts, I'll pass the call back to Cody Fletcher for some questions from the retail community.

Thank you, operator. We have our first question from X user at [indiscernible] 333. His question was Visa, Mastercard, Zelle, they're all now talking about stablecoins. So how can Bakkt kind of compete with these companies. Akshay, you want to take this one?

I mean, it's similar to what Chris was alluding to as it relates to Zero Ash. But look, I'll answer this as well. So it's a fair question. We don't really see ourselves competing head-on with the big card networks of peer-to-peer systems. What Bakkt is doing is more of the picks and shovels layer, the regulated infrastructure that lets the whole ecosystem operate securely and at scale. And so there's a lot being said about stablecoins and new payment rails these days, and it's a good thing because it validates the overall direction that we are heading in. But there are still some very big gaps in how those systems work, particularly around compliance, custody, the payment rails and then the integration of it all into the TradFi rails. And for Bakkt, the cooperation agreement with DTR brings those capabilities directly inside Bakkt. And that really gives us a very solid footing as this market continues to evolve and grow materially over years to come, in my opinion. So the fintech space is huge. That's why I left a very lucrative career to be involved in this space because I believe that it's never going to be a winner-take-all space. It's that big. Different players can coexist, some consumer-facing, others like us providing the regulated backbone underneath. And if you look at, generally speaking, what's happening in terms of the recent M&A activity, by some of the very companies that you were mentioned in the questions and the private market valuations in the space, you can draw your own conclusions. Many of these companies are being bought by the very large names that were mentioned while they might not be showing any top line growth and are doing it with a lot of heavy burn and with our profitability. At least that's what the bankers are telling us. So we are taking a much more disciplined approach. We're building a sustainable compliant business that can scale responsibly and as the transformation ramps up here at year-end, I think that discipline combined with where the broader market is headed would speak for itself as to what Bakkt is building at this end. Hope that answers the question.

That's great. And our last question here is from another X user at [ Amir X Trades ]. Amir said, being invested in your company for 4-plus years like so many other shareholders, Bakkt time and time again loses all of its gains due to poor decisions and lack of updates. What will this new leadership team do differently to improve shareholder value over time.

So yes, Amir and a few other users on X have messaged me from time to time directly or tweeted at me, and I completely understand their frustration. I mean this is exactly why this new leadership team came in to fix the structure, clean up the balance sheet and refocus Bakkt on its core mission. I definitely cannot control or manage the company based on short-term stock price moves. As Mr. Buffett famously says, in the short term, the markets are voting machine. But in the long term, it's a weighing machine. And our job really is to build the kind of substance that the market will weigh over time. I believe we've made a lot of strong progress on the transformation, and we expect to have it largely completed by year-end. Either before year-end or at our Investor Day in Q1 '26, we'll share clear KPIs. We hope to announce the distribution partnerships that are currently being worked out, and we'll outline the next phase of our road map accordingly. And I hope that, Amir, you will see that progress and you'll continue supporting us as a long-term shareholder. Back to you, Cody.

Thanks, Akshay. That's all the questions we have in retail. So back to you, operator, to close this out.

Certainly. Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.

Greetings, and welcome to the Bakkt Second Quarter 2025 Earnings Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded. I will now turn the call over to Cody Fletcher, Investor Relations adviser at Bakkt. Please go ahead.

Hello, everyone, and thank you for joining Bakkt's Second Quarter 2025 Earnings Call. Before we get started, I'd like to remind everyone that today's earnings call includes a separate supplemental presentation that can be found at our Investor Relations website at investors.bakkt.com. During today's call, we will make certain forward-looking statements, including statements regarding our signed commercial agreement with Distributed Technologies Research, or DTR, and the anticipated integration of DTR's stablecoin and AI payment infrastructure with Bakkt's regulated platform. We'll also discuss our strategic realignment into a pure-play crypto infrastructure company, including the divestiture of our Custody business to ICE, including expected time lines, and the definitive agreement signed regarding the divestiture of our Loyalty business, as well as expectations regarding the stablecoin payments market, regulatory environment and our product road map. These statements are based on management's current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. For additional information regarding forward-looking statements and risk factors, please refer to our filings with the Securities and Exchange Commission, including our quarterly report on Form 10-Q for the second quarter of 2025. Further, in addition to discussing results that are calculated in accordance with generally accepted accounting principles, we will also make reference to certain non-GAAP financial measures. For more detailed information on our non-GAAP financial disclosures, please refer to our full earnings release which can be found on our Investor Relations website. Thank you, and I'll now turn the call over to Andy. Andy?

Thank you, Cody, and hello, everyone. Thanks for joining Bakkt's Second Quarter 2025 Earnings Call. It's great to connect with you all again. With me today is Akshay Naheta, co-CEO; and Karen Alexander, our Chief Financial Officer. To begin today, I'd like to zoom out to view the broader market. As you can see, it's clear we're on the cusp of a generational shift of what money is, how it's used and how it's moved around the globe. Blockchain technology is beginning to transform traditional markets, and over $700 trillion in global assets from equities and bonds to real estate are potential candidates for disruption. This is not a niche trend. We believe it's a rearchitecture of the financial system itself. Digital assets are emerging as a transformational asset class, combining value, computing and programmable functionality in ways that legacy systems cannot replicate. Institutional adoption is accelerating with ETFs, tokenized securities and programmable payments bridging the gap between innovation and tradition. At Bakkt, we are positioning ourselves to be a core enabler of this monumental trend. Our stablecoin payment infrastructure, built in partnership with DTR, is designed to meet institutional grade standards while unlocking entirely new use cases for cross-border value transfer. With a leaner, more focused operating model and a team purpose built for this next phase, we believe Bakkt is well positioned to help lead the tokenization of real-world assets as this market evolves. Since stepping into the CEO role last March, I focused on strategically realigning Bakkt to unlock its full potential. We took decisive action to streamline our operations, reducing costs, exiting noncore businesses and refocusing the company on crypto, where we see the greatest opportunity for long-term growth. A major step forward was forming our partnership with DTR, which gives us the infrastructure to compete in one of the most disruptive blockchain use cases, stablecoin payments. To drive this vision, I brought in Akshay Naheta, CEO of DTR as co-CEO of Bakkt, and a strengthened leadership team with deep expertise across crypto and fintech. Today, I'm excited to share with you that we have made significant progress since our last call that accelerates Bakkt's realignment into a pure-play crypto infrastructure company. During the quarter, we completed the sale of Bakkt Trust Company to Intercontinental Exchange or ICE. This was the first step in our strategic realignment as we saw significantly higher competition in the custody landscape following the repeal of SAB 121, which led larger institutions to enter the crypto custody space. On July 23, we entered into a definitive agreement to divest our Loyalty business to Project Labrador Holdco, LLC, a wholly owned subsidiary of Roman DBDR Technology Advisors, Inc. When completed, this transaction will represent the completion of our strategic divestiture initiatives and marks a pivotal step that will accelerate our focus entirely on our core crypto offerings and forthcoming stablecoin payments infrastructure. The transaction includes monetary accommodations of $11 million plus relief of estimated negative working capital and indebtedness to ensure a smooth transition. We expect the transaction to close in the third quarter, subject to customary closing conditions. Beginning in Q3, once the sale is finalized, we will report the Loyalty business as a discontinued operation. With the divestiture of Bakkt Trust and the expected completion of the divestiture of our Loyalty business, we are transitioning into a lean efficient organization that's ready to execute at scale. Our newly streamlined organization ensures we can move quickly to capitalize on market opportunities while maintaining cost discipline. The divestitures of Trust and Loyalty will reduce our cost structure and free up working capital that will reduce our cash burn and accelerate our path towards profitability. On July 31, we signed a commercial agreement with DTR, which paves the way for the completion of the integration of our systems with DTR's, enabling innovative stablecoin payment solutions for our customers. We are already laying the groundwork for these innovative offerings, which Akshay will cover during his remarks. Further, on July 30, we successfully closed a $75 million SEC registered offering of common stock and warrants. This new funding significantly recapitalizes our balance sheet and supports our exciting growth initiatives as well as the launch of a differentiated Bitcoin treasury strategy, which Akshay will cover in more detail shortly. We're now operating as a leaner, more agile organization focused squarely on the growing trend of digitalization of real-world assets. It's still early innings but I believe Bakkt is well positioned to lead in this next wave of innovation. As a result of the tremendous progress we've made over the past year, the clear opportunities ahead of us as a pure-play crypto company and the regulatory approval process for Akshay substantially complete, I want to share that effective today, I am handing the reins over to Akshay, who will assume the sole CEO position to lead Bakkt forward. I'd like to take this opportunity to thank Akshay for his partnership over the last several months and to congratulate him on becoming Bakkt's next CEO. I will remain closely involved as an adviser, focusing on finalizing the Loyalty divestiture and offering strategic guidance as Bakkt enters this exciting phase of growth. I'm confident that with Bakkt's strong regulatory moat and technology infrastructure, under Akshay's leadership, Bakkt will transform into a leading platform in the crypto ecosystem for sustained growth. Thank you to our shareholders and partners for your support over the past year and being a part of Bakkt's evolution. With that, I will now turn the call over to Akshay.

Thank you, Andy, for your leadership through Bakkt's strategic restructuring and positioning the company for long-term success. I'm honored to build on this foundation to unlock the next phase of growth for Bakkt as a leading global crypto infrastructure platform. Starting on Slide 5, I want to frame where Bakkt is headed over the coming quarters. As Andy just mentioned, we're still in the early innings of a massive market opportunity. To better position Bakkt to capitalize on this opportunity, we are building Bakkt to be a leaner and more agile company free of our legacy noncore assets. Further, we have successfully recapitalized our balance sheet with over $100 million of financing to accelerate the 3 pillars of our growth strategy, which positions us at the center of this transformation in money and global finance. First, our brokerage-in-a-box solution, a turnkey platform that enables clients to achieve a rapid time to market to launch in the U.S. while operating under SOC 2 compliance and the necessary regulatory licenses. Over the second half of the year, we are preparing to roll out a comprehensive set of technology upgrades to our platform that will significantly enhance user experience, expand trading capabilities and create new monetization opportunities for Bakkt. Second, stablecoin payments powered by our DTR partnership. This is where we are delivering programmable agentic solutions designed for cross-border value transfers, positioning Bakkt to compete in one of the most disruptive blockchain use cases in the market today, stablecoins. Third, our Bitcoin treasury strategy, which we initiated just last week through our investment in Marusho Hotta to be renamed bitcoin.jp upon shareholder approval. We plan on taking this differentiated approach to other markets over the next few quarters that will leverage the technical know-how to drive and manage an active treasury strategy, institutional custody solutions, yield generation and seek mNAV expansion for these companies. Together, these 3 pillars give us a clear and high conviction road map to capture on the biggest trends in tokenization, stablecoin adoption and Bitcoin adoption. We will now discuss each of these 3 pillars in more detail beginning on Slide 6. Our brokerage-in-a-box solution is already one of the most complete turnkey brokerage solutions available in the U.S. today. We provide full license coverage across the country, integrated liquidity solution and a regulated SOC 2-compliant technology stack, all designed to give clients rapid time to market with advanced brokerage and trading capabilities. This combination of compliance, infrastructure and speed positions us as a trusted partner for institutions that don't want to build their own infrastructure from scratch. Additionally, we are leveling up our trading infrastructure in a big way. Over the second half of 2025, we plan to begin rolling out Brokerage-in-a-box 2.0, a comprehensive technology upgrade to a platform that significantly expands our capabilities and revenue potential. These enhancements will increase the supported coins in our platform to over 200 from approximately 50 today, upgrade our current trading engine, add social features such as copy trading, which lets users replicate the strategies of top traders in the platform, as well as yield generation capabilities. We are also introducing a redesigned user interface to improve the client experience and integrate support for tokenization use cases across broader assets aligned with the pending Digital Asset Market Clarity Act of 2025. We believe these upgrades will significantly enhance our monetization opportunities while maintaining the same speed to market and compliance standards which will make our platform extremely effective. As we roll out Brokerage-in-a-box 2.0, our immediate strategic priorities are deepen current clients and prospective client engagement, strengthen our growing sales pipeline and broaden our monetization opportunities. We are already seeing strong adoption. We've recently added Longbridge, AscendEX and BTSE to our platform and are seeing increased demand from institutions around our capabilities to offer other value-added crypto services while maintaining their existing brand relationships. Our platform is particularly compelling for international companies looking to immediately onshore into the U.S. market. Our sales funnel also remains healthy with more than 400 leads at the top of the funnel and over 10 qualified leads moving through late-stage discussions. This strong pipeline reflects the growing global demand for turnkey brokerage solutions. On the product side, we are focusing on delivering immediate enhancements that include institutional-grade custody partnerships to meet the highest standards of B2B control panel to give clients greater operational control and efficiency and margin-lending products to expand trading capabilities and to create new revenue streams. These initiatives are designed to reinforce Bakkt's leadership in compliance scalable brokerage infrastructure while positioning us to capture a larger share of the market as institutional adoption of digital assets accelerate. Our second pillar, stablecoin payments highlighted on Slide 8 is becoming a reality through the upcoming launch of Bakkt Agent, our AI-powered global transfers product and the first step in our vision to simplify and automate complex financial transactions for consumers. This product is designed to deliver efficient domestic and cross-border payments, one of the most disruptive blockchain use cases in the market. As consumers are getting more habituated with AI agents, the Bakkt Agent is capable of transforming any message interface into a programmable money platform with just a few lines of code. This solution will deliver chat-based transfers where users can send, receive and convert funds through natural interactions like voice commands, text messages or images, all through very familiar conversational interfaces that people already use. The conversational AI-driven experience will simplify the complexity of managing finances, allowing users to simply tell the agent what to do, eventually moving beyond simple transfers to create a platform that truly differentiates us from neobanks of the past. Bakkt Agent is fully interoperable with our brokerage platform via APIs, enabling agentic global payments and expanding our remittance infrastructure through the DTR integration. We have launched a private beta for early testers this month, enabling transfers to over 36 countries initially with plans to expand to more than 90 countries within the next few quarters. Our focus is on the high remittance corridors in Asia and LatAm. By the end of Q3, we are planning to roll out the consumer offering to existing clients followed by a Q4 pilot with select businesses. Looking ahead, our road map is focused on developing a full featured financial AI agent that can autonomously manage and move money, a fundamental shift from traditional banking and not just an incremental improvement but a new paradigm in how people interact with their money. This includes introducing clients to current and saving accounts, overnight interest-bearing accounts and payment cards for both local and international spending. These features will extend Bakkt's role in the digital money ecosystem, offering clients and consumers a comprehensive suite of blockchain and AI-enabled financial tools. This initiative not only positions us at the forefront of stablecoin adoption but also builds a scalable capital-light SaaS platform with multiple monetization channels in a market that's still in its very early innings. Finally, our third pillar, the Bitcoin treasury strategy beginning on Slide 10. It is clear that leading companies adopting a Bitcoin treasury strategy at scale have created tremendous value for their shareholders. Our differentiated approach is to capitalize on markets with unique structural advantages. We are focused on large liquid markets, beginning with Japan, where there are few publicly listed companies and institutionally credible vehicles such as ETFs offering direct current exposure. This dynamic, combined with a strong demand for digital assets has resulted in premium mNAV to public companies that are actively accumulating Bitcoin onto their balance sheet. The markets that we'll focus on present high barriers to entry in terms of regulatory licensing and market trust, creating a durable competitive moat. The markets also have more predictable supportive regulatory frameworks for digital assets as well as certain favorable tax-related advantages for corporations holding Bitcoin. Furthermore, we plan on bringing retail brand recognition through the ownership of domains such as bitcoin.jp and bitcoin.kr, positioning us to achieve strong market visibility, which we believe will strengthen our position with institutional and retail investors. We believe our expertise and our unique approach will enable us to operate at scale, leveraging institutional-grade custody solutions, enhancing returns through yield generation capabilities and creating recurring revenue streams for Bakkt via treasury management and related services. Together, these elements position Bakkt to deliver sustainable value for our shareholders, and we plan on expanding this model into other strategic markets and geographies over time. And we've already begun executing, beginning with Japan. Japan's growing interest for crypto and clear regulatory framework for digital assets makes it an ideal jurisdiction to initiate our differentiated Bitcoin treasury strategy. On August 7, we successfully closed the share purchase agreement to acquire approximately 30% of Marusho Hotta Co Ltd, or MHT, a Tokyo-listed company, making Bakkt the company's largest shareholder. As part of the transaction, we have nominated Phillip Lord, President of Bakkt International, as CEO of MHT to oversee the integration of Bitcoin into the company's operating and financial model. Further, we plan on rebranding the company's name to bitcoin.jp, pending MHT shareholder approval. Bitcoin.jp will also be the title sponsor of the upcoming leading Web3 and blockchain conference in Asia, WebX2025 in Tokyo at the end of August. We look forward to sharing more details on this at the next earnings call following the AGM of MHT, which is expected to be in the second half of October. In closing, as a result of Bakkt's strategic realignment, we believe that we will be a significantly more focused company, which is uniquely positioned to capitalize on the massive tailwind of the digitalization of assets. I want to end my remarks today on Slide 12 and summarize the key near-term strategic priorities that we plan to execute over the next couple of quarters. One, finalize the sale of our Loyalty business. This marks a pivotal milestone that will accelerate our focus entirely on our crypto offerings and stablecoin payments infrastructure. Two, as we move forward without our legacy non-crypto businesses, we will finalize a comprehensive review process, fully rightsizing our cost structure aligned to our existing revenue base. This includes a bottom- up evaluation of our organizational structure, third-party service providers, internal workflows and technology optimization to drive synergies across our business. We plan to share details of this plan on our next earnings calls. Three, commence rollout of our Brokerage-in-a-box 2.0 technology upgrades and new product road map to position Bakkt to capture efficiencies and significant monetization opportunities. Four, launch our stablecoin payments platform, Bakkt Agent, that efficiently enables cross-border payments and, over time, reshape the way consumers manage and move money in their everyday lives. Lastly, expand our Bitcoin treasury strategy to other markets, having initiated it with Japan, where there's a clear regulatory and structural advantage for Bakkt as we started with MHT. We are looking forward to providing updates on this in our next earnings call. I want to thank our customers and shareholders for their continued support and patience as we are well on our way into a major strategic transformation. We are still in the early stages of a generational shift in what money is, how money moves and how markets operate and trade. I'm excited to lead Bakkt into this exciting global trend of digital assets as we unlock long-term value for our shareholders through our differentiated position as a pure-play crypto infrastructure company. I'll now turn it over to Karen to review the Q2 financial results in more detail. Karen?

Thank you, Akshay. I will now walk you through Bakkt's second quarter KPIs and financial results. As a reminder, in accordance with GAAP, we present crypto services revenue and crypto costs and execution clearing and brokerage fees on a gross basis as we are a principal in the crypto services we provide our customers. By contrast, we are an agent in the loyalty redemption services we provide our Loyalty customers. Therefore, Loyalty revenue is presented on a one-line net basis. Starting with our crypto trading volumes. Sequentially, Q2 experienced a decline in crypto trading volumes, which aligned with broader market trends during the second quarter. The crypto market faced headwinds from March through June as investors adopted a cautious stance amid regulatory uncertainty and macroeconomic pressures that characterized the first half of 2025. Crypto trading volume for the second quarter was also impacted by the previously announced restructuring of our relationship with Webull as we discussed in prior earnings calls. Despite these near-term challenges, we remain optimistic about the strong tailwinds ahead. The regulatory environment has never been more supportive with the current administration and Congress demonstrating unprecedented bullishness towards digital assets. Since the end of Q2, with Bitcoin hitting new all-time highs in July, we experienced a significant improvement in our trading volumes, up 50% month-over-month. As Akshay mentioned, we've also onboarded 3 new institutional clients to our platform, Longbridge, AscendEX, and BTSE, who we expect will meaningfully contribute to our trading volume activity moving forward. We believe this favorable policy backdrop, combined with our pure-play crypto infrastructure positioning, full-scale DTR integration and expanding partner pipeline, position us well to capitalize on the next wave of institutional adoption and market growth. Now on Slide 15, I'll walk you through our Q2 KPIs, which provide insight into the underlying trends driving our business. In Q2, total active transacting accounts were 689,000, segmented into 265,000 Loyalty redemption accounts and 424,000 crypto trading accounts. This reflected the overall market as the heightened activity we saw in Q4 of last year dwindled over the next 2 quarters with uncertainty in the markets around legislation. The year-over-year comparison was relatively flat. Total notional volume for Q2 was $733 million comprised of $565 million from crypto trading and $168 million from Loyalty redemptions. Our crypto trading volumes underperformed market benchmarks on a sequential basis but outpaced the market on a year- over-year comparison, demonstrating our resilience over longer time frames. Loyalty redemption volumes declined year-over-year but increased sequentially. The year-over-year decline in volumes is driven by the exit of a Loyalty client in 2024 and general softening in historical redemption levels. The sequential increase in volume reflects redemption promotions that occurred in the second quarter. Finally, assets under custody at our custodian partners for our brokerage business totaled $1.36 billion. In the quarter, we completed the sale of our Trust business to ICE. We continue to offer custody solutions for our clients through our partners, BitGo and Coinbase Custody. On Slide 16, we show our total revenue broken out between our crypto and Loyalty products. Total revenue for the second quarter of 2025 was $577.9 million, up 13.3% year-over-year and down 46.2% sequentially. Gross crypto services revenue for the quarter was $568.1 million, up 14.3% year-over-year and down 46.7% sequentially. As noted earlier, the sequential decline in gross crypto services revenue reflects the market's moderation after a record-breaking performance in the fourth quarter of 2024, while year-over- year increase demonstrates improved market sentiment we have seen in crypto since the fourth quarter of 2024. Crypto services revenue, net of crypto costs and execution clearing and brokerage fees, or ECB, totaled $2.9 million, reflecting a 41.1% increase year-over-year and a 15.7% decrease sequentially. Net Loyalty revenues were $9.8 million, down 23.3% year-over- year and up 6.8% sequentially. Of this amount, Loyalty transaction revenues contributed $5.8 million while subscription and services revenues were $4 million. The year-over-year decline was primarily related to the exit of a Loyalty client in 2024 as well as reduced volume-based services revenue and transaction volume. The increase sequentially was due to higher transaction volumes driven by seasonal redemption promotions. Moving to Slide 17. Total operating expenses for the quarter were $596.4 million, including $565.2 million of crypto costs and ECB, which are correlated to crypto trading volumes. SG&A expenses were $3.6 million, down 34.9% year-over-year and 6.2% sequentially, driven by reductions in insurance, marketing and promotion and occupancy costs. Total compensation expense was $20.1 million, down 10.1% year-over-year and up 12.9% sequentially. The year-over-year decline reflects lower salaries, wages and benefits driven by our restructuring actions in 2024. The sequential increase in compensation expense is driven by our stock-based compensation awards granted in lieu of cash bonuses and for new employees. Turning to Slide 18, we present our condensed profit and loss statement. Net loss for the quarter was $30.2 million, improving 15.1% year-over-year from a loss of $35.5 million. $15.4 million was attributable to the noncontrolling interest in the operating company and $14.7 million attributable to Bakkt's holdings, resulting in a loss of $2.16 per share for both basic and diluted EPS. On Slide 19, we have our condensed balance sheet as of June 30, 2025. We ended the quarter with $61.5 million in cash, cash equivalents and restricted cash. The $20.5 million sequential increase in our cash position in Q2 was primarily driven by the $23.7 million of net proceeds from our convertible debt offering in June, $4.5 million of proceeds from the sale of Bakkt Trust in May, and a $1.9 million reduction in restricted cash collateral requirements, partially offset by the repayment of $5.2 million of principal and accrued interest on the ICE line of credit and other operating cash utilization. At the end of July, coinciding with our successful $75 million capital raise, of which we received approximately $68.8 million after deducting the underwriting discounts and commissions, we terminated the ICE line of credit agreement, given the pending sale of Loyalty and our strengthened liquidity position. On Slide 20, we have our adjusted EBITDA for the second quarter of 2025. Adjusted EBITDA reflects adjustments for certain noncash and restructuring and transaction-related items that impacted the period. Adjusted EBITDA for Q2 2025 was a loss of $12.6 million. The year-over-year improvement in adjusted EBITDA loss, which narrowed by 29.9%, was primarily due to the overall decrease in compensation and benefits and SG&A expenses, partially offset by an increase in professional fees. Thank you, everyone. That concludes the prepared remarks section of our second quarter 2025 earnings call. I will now pass it back to Cody for closing.

Thank you, Karen, Andy, Akshay, and everyone, for attending our earnings call. We look forward to connecting with you again soon.

That concludes the conference call. Thank you for your participation. Enjoy the rest of your day.

Greetings and welcome to the Bakkt First Quarter 2025 Earnings Conference Call. At this time all participants are in a listen-only mode. As a reminder this conference call is being recorded. I'll now turn it over to Cody Fletcher, investor relations advisor at Bakkt. Please go ahead.

Hello everyone and thank you for joining Bakkt’s first quarter 2025 earnings call. Before we get started I'd like to remind everyone that today's earnings call includes a separate supplemental presentation that can be found at our investor relations website at www.investors.bakkt.com. During today's call we will make certain forward-looking statements including statements regarding our cooperation agreement with DTR, the proposed commercial agreement with DTR expected by Q3 2025, and the anticipated integration of DTR stablecoin and AI payment infrastructure with Bakkt’s regulated platform. We'll also discuss our strategic transformation to a pure play crypto infrastructure company including the divestiture of our custody business to ICE, including expected timelines and ongoing discussions regarding our loyalty business, as well as expectations regarding the stablecoin payments market, regulatory environment, and our product roadmap. These statements are based on management's current expectations and are subject to risks and uncertainties which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. For additional information regarding forward-looking statements and risk factors, please refer to our filings with the Securities and Exchange Commission, including our quarterly report on Form 10-Q for the first quarter of 2025. Further, in addition to discussing results that are calculated in accordance with generally accepted accounting principles, we also make reference to certain non-GAAP financial measures. For more detailed information on our non-GAAP financial disclosures, please refer to our earnings release which can be found on our Investor Relations website. Thank you, and I'll now turn the call over to Andy.

Thank you, Cody, and hello everyone. Thanks for joining Bakkt’s first quarter 2025 earnings call, and it's great to connect with you all again. With me today is Karen Alexander, our Chief Financial Officer, and I am excited to introduce Akshay Naheta, Founder of Distributed Technologies Research, or DTR, who officially joined Bakkt as co-CEO on March 21st. Starting with our Q1 performance, we navigated a slower crypto market following the post-election rally of late 2024, with our total transaction volume reaching $1.06 billion for the quarter. This represents a 40% sequential decline from our strong Q4 results and a 23% below the broader market. On a year-over-year basis, our performance reflects a more positive story, with volumes growing 23%, outpacing the growth of our broader market benchmark. This achievement is particularly meaningful, considering we are comparing against a period that included March 2024's significant activity and price surge driven by Bitcoin ETF purchases and the meme coin rally we saw from SHIB and DOGE. Despite softer market conditions, this volume represents substantial progress for Bakkt as we continue to grow our market presence. We believe these metrics demonstrate our platform's resilience. While we adjust to current market dynamics, we believe our year-over-year performance relative to the industry demonstrates the strength of our value proposition and expanding customer base. For the quarter, total revenues net of crypto costs, execution, clearing, and brokerage fees decreased 25.9% year-over-year to $12.6 million. Total operating expenses, excluding crypto costs and execution, clearing, and brokerage fees decreased 36.3% year-over-year to $31.1 million. Net income improved 176.5% year-over-year from a loss to a profit of $16.2 million. Adjusted EBITDA loss non-GAAP improved 11% year-over-year to $14.5 million. From an operational standpoint, we are making progress on our transformation to a pure-play crypto infrastructure company. The sale of Bakkt Trust Company to Intercontinental Exchange is expected to close on or about May 15th. And as mentioned on our previous earnings call, we continue to explore strategic alternatives for our loyalty business and are in discussions with potential buyers. We believe this represents the best path forward, eliminating ongoing operational losses while focusing our resources on higher growth and higher margin opportunities. These initiatives reflect our sharpened focus on core crypto infrastructure. We are deepening our strength in crypto trading and expect to expand into stablecoin payments ecosystem through our planned collaboration with DTR. Steps that we believe will accelerate our evolution and position us to capture more potential opportunity in the digital asset space. As Akshay will describe in more detail shortly, we remain committed to disciplined expense management. With our cooperation agreement with DTR signed and the negotiation of a commercial agreement and integration with DTR underway, we are taking a bottom-up rather than top-down approach to operational efficiency, methodically evaluating each aspect of our business to identify opportunities for improvement while preserving our ability to capture growth. We believe this granular approach will help ensure that we are making strategic decisions about resource allocation without compromising our competitive positioning. During this period of refinement, we are suspending our practice of providing quarterly guidance as we work to finalize the definitive commercial agreement with DTR and complete our optimization review. Lastly, we have brought on key hires who are seasoned leaders in crypto and payments. Philip Lord, President of Bakkt International, and Ankit Khemka, Chief Product Officer for Bakkt. Akshay will explain a little more about their backgrounds and how they bring tangible value to the table. With our sharpened strategic focus, I want to take a moment to articulate our vision for Bakkt’s future. Through our cooperation agreement and pending commercial agreement with DTR, Bakkt intends to power how businesses and consumers interact with digital payments. We are transforming to be not just a crypto trading platform but an essential infrastructure layer for the future of finance. The regulatory tailwinds we are experiencing have created unprecedented opportunities in crypto trading, stable coin related payments infrastructure, and agentic commerce. We believe that this favorable environment, coupled with our combination of regulated infrastructure and cutting-edge technology, positions us at the forefront of a multi-trillion dollar transformation in global financial services. I would now like to hand over to Akshay Naheta to share more about DTR and our partnership. Akshay.

Thank you, Andy, and thank you everyone for joining us today. I would like to preface my remarks by saying how optimistic I am for the future of Bakkt at this pivotal time as we stand at the cusp of transforming Bakkt into a prime gateway for programmable money. By leveraging our position as a regulated, publicly traded entity with comprehensive license coverage across the U.S., a SOC 2 compliant tech stack, robust liquidity solutions, and brokerage-in-a-box capabilities, I believe Bakkt has a strong foundation to capture the significant opportunities ahead. In addition, I believe Bakkt’s highly sophisticated and trusted infrastructure and regulatory moat gives us a competitive opportunity to leverage DTR's stablecoin and AI payments technology, allowing us to enter the global payments and remittance ecosystems. Most excitingly, we believe that the expected integration of DTR's APIs for agentic global payments will harness the power of AI to create intelligent, programmable money solutions that transform how businesses and consumers interact with digital assets in their daily transactions. This collaboration aims to transform Bakkt into a pure-plate crypto infrastructure company by combining complementary strengths. Bakkt’s established regulatory framework and trading capabilities provide a secure foundation essential for institutional adoption and consumer trust. The planned DTR integration will introduce innovative technology that enables seamless movement of money by bridging national payment rails and currencies with stablecoins. We believe that this will result in a powerful convergence of regulated innovation between traditional and decentralized finance and will create an agentic infrastructure well-suited for supporting the next generation of digital commerce at a global scale. Now let me walk you through our go-to-market strategy and implementation timeline. While the commercial agreement is not yet complete, there will be engineering work to integrate DTR into Bakkt and finalize our ability to secure API-enabled fiat rails in the U.S. This timeline reflects our expectations for a clear phased approach to bring our combined capabilities to the U.S. market. The foundation of this partnership will be a comprehensive commercial agreement between Bakkt and DTR, which we expect to complete by Q3 of this year. Significantly, the collaboration agreement already executed by Bakkt and DTR included an option for Bakkt to acquire DTR, creating a potential path to full integration of our complementary technologies and teams. Following the execution of the commercial agreement, we expect to move into the integration phase, connecting DTR and Bakkt systems across three critical dimensions – risk and compliance frameworks, USD fiat rails, and our payments product suite. We believe this technical integration will create the infrastructure backbone necessary to deliver our enhanced offering. By Q3 2025, we expect to begin product launch for our early access premium partners. These early adopters will be key strategic clients that can provide valuable feedback and validation as we refine our offering. We believe this careful testing phase will help ensure that we execute successfully. One thing to note, timing of the initial launch will depend on Bakkt securing a reliable and efficient API-enabled fiat rail in the U.S., and those efforts are already actively underway. By the end of Q3, we anticipate a market-wide launch, extending our integrated offering to the broader marketplace. We believe this phased rollout strategy balances speed to market with client experience to ensure we capitalize on immediate opportunities while also building for sustainable long-term success. As we focus the company to capitalize on becoming a gateway to programmable finance, I want to highlight the three key pillars of Bakkt’s transformation. As Andy mentioned before, we believe the pending divestiture of our custody business and our ongoing discussions for divesting our loyalty business will streamline Bakkt to concentrate on its core strengths. In parallel, we expect to implement comprehensive cost reduction initiatives and optimize the efficiency of our organizational structure and technology stacks. We believe these initiatives will strengthen our strategic priorities as we emerge as a more entrepreneurial company with scaled trading systems, strengthened leadership, and enhanced capabilities in stablecoin payments and agentic AI technology. I am excited to introduce these two exceptional leaders to our executive team. They bring world-class experience to accelerate our strategic transformation. Philip Lord joins us as President of Bakkt International, leveraging his significant growth experience across global platforms, leadership at crypto payments platform Oobit, and extensive involvement in the DeFi space for over 10 years. And Ankit Khemka comes aboard as Chief Product Officer, bringing his expertise in scaling hyper-growth tech companies like Revolut and his proven track record in product innovation across international markets. Both executives bring invaluable expertise in crypto payments and global expansion that will be instrumental as we integrate DTR's capabilities and expand our footprint in the programmable money ecosystem. Now I'd like to shift our focus to the transformative potential of our collaboration where we believe Bakkt’s regulated infrastructure and DTR's cutting edge stablecoin and AI technology, when integrated, will create a powerful combination that has the potential to help redefine digital payments globally. Let me highlight the transformative capabilities we believe DTR will bring to enhance Bakkt’s ecosystem. We expect that DTR's technology will integrate frictionless global payments infrastructure with Bakkt’s trusted regulatory framework. DTR's user-centric, intent-driven architecture works invisibly behind existing interfaces, allowing customers to continue using familiar wallet and messaging systems without disruption. We believe DTR's lightning-fast settlement technology will revolutionize transaction processing, delivering instant effects conversion while maintaining the regulatory guardrails essential in today's environment. DTR's extensive ION network, which is anticipated to span more than 90 countries by Q3 2025, will include relationships with local banking partners worldwide, solving the complex puzzle of cross-border payments and regulatory requirements. All of this will operate within a comprehensive security and compliance framework that will incorporate industry-leading KYC AML protocols. We anticipate that this powerful combination will create a seamless bridge between TradFi and next-generation digital payments, bringing institutional-grade infrastructure to power the future of programmable money. We believe the payments landscape is on the cusp of a massive transformation with stablecoins emerging as a key catalyst. The numbers highlight the enormous opportunity in front of us. Cross-border payments reached $195 trillion in 2024 and are projected to hit $320 trillion by 2032, according to FXC Intelligence. Today, stablecoins command just 3% of this payments market at $5.85 trillion, but industry projections indicate this share will surge to 20% of $64 trillion by 2032. A remarkable growth trajectory driven by three factors. One, consumer demand is intensifying for faster, cheaper, and trustworthy payment solutions, which stablecoins deliver through instant settlement, lower validation-based fees, and blockchain transparency. Two, the regulatory environment is increasingly favorable with the Stable Act moving through Congress, major institutional players reportedly exploring stablecoin issuance, and three, the U.S. positioning itself to become the crypto capital of the world. We believe this convergence of market size, technological capabilities, and regulatory tailwinds will create an unprecedented opportunity for Bakkt and DTR when integrated to capture significant market share in this rapidly evolving ecosystem. What you're seeing here is a planned architectural blueprint of our technology stack where Bakkt’s regulated infrastructure will serve as the essential bridge between traditional and decentralized financial systems. On the left, we connect seamlessly with TradFi's established payment rails, fiat currencies, and institutional infrastructure, while on the right, we plan to extend into the innovative on-chain ecosystems through AI agents, stablecoins, and plug-and-play APIs and chatbots. We believe this unified approach will eliminate many of the traditional barriers between these worlds, creating a financial system that will combine the regulatory compliance and stability of traditional finance with the programmability, transparency, and efficiency of blockchain technology. By facilitating this convergence, we aim not just to enhance existing financial services, but to enable entirely new capabilities that neither ecosystem could achieve independently. Through this expected integration, we will create a frictionless, programmable, and fully auditable payment ecosystem that reimagines how transactions are initiated and completed. The process will begin with agent triggers where AI will be able to intelligently initiate transactions based on predetermined conditions or real-time needs with enhanced functionalities through our combined payments infrastructure. Critical to the system is the customer approval checkpoint, which will ensure that despite AI initiation, humans maintain control through verification requirements, preventing scenarios where the AI could autonomously execute transactions uncontrollably. We believe this balance between automation and human governance will be essential for compliance and responsible deployment. Bakkt’s rails will provide the secure processing layer, leveraging regulated infrastructure to ensure every transaction meets compliance requirements while maintaining the highest security standards throughout the payment journey. The final component, global settlement, will deliver instant completion across borders, currencies, and financial systems, eliminating the days-long settlement times typical in traditional cross-border transactions. Together, these four components aim to create a payments ecosystem that will combine AI efficiency with human oversight, fraud prevention, and regulatory compliance with technological innovation, while dramatically reducing friction in global commerce. The following products you'll see on this roadmap represent DTR's current capabilities that will be integrated into Bakkt’s offering following the expected signing of our commercial agreement estimated by Q3 2025. With technical integration and testing already underway, which we believe will ensure we are prepared for our expected launch with premium partners in Q3 2025, followed by our expected market-wide launch targeted for the end of Q3 2025. While previously noted, the timing of the initial launch is contingent on Bakkt securing reliable and efficient API-enabled fiat rails in the U.S., a process that is actively underway today. Bakkt checkout will represent our gateway solution for merchants to seamlessly integrate stablecoin payments into their existing commerce infrastructure. We expect that this product will enable merchants to accept stablecoin payments with real-time confirmation, significantly lower fees compared to traditional payment processors, and instant settlement directly into fiat currency in over 46 countries. We will design the solution so that implementation is remarkably straightforward. Merchants simply add crypto as a payment option to their checkout page, and our system will handle all the complexity of blockchain transactions, currency conversions, and regulatory compliance behind the scenes. As you can see from the illustrative interface on the right, we have designed the customer experience to be intuitive and familiar, such that paying with stablecoins is as simple for the consumer as any traditional payment method while delivering significant efficiencies. Bakkt Agent will be our white-labeled AI-powered plugin that will transform any messaging interface with just a few lines of code into a programmable money box. We expect that this solution will deliver a native experience that uses existing app interfaces, eliminating the need for users to download new wallets or learn complex crypto flows. The core functionality will enable chat-based transfers where users can send, receive, and convert funds through natural interactions like voice commands, text messages, or even images. The intended result will be a seamless global money movement, permitting transfers of both fiat and stablecoins worldwide through the familiar conversational interfaces people already use. Our design will ensure that developers can quickly integrate this powerful functionality into their existing applications with minimal technical overhead, dramatically reducing time to market for advanced payment capabilities. Thank you for your time today as we have outlined our vision for the future of Bakkt in the world of programmable money. Looking forward, as we continue to further strengthen the leadership team, launch new products, and sign up new customers and partnerships, I believe that we are poised to accelerate sustainable growth, thereby unlocking significant value for Bakkt’s customers and shareholders. Now I'll pass the call to Karen for her review of Bakkt’s financials for the first quarter.

Thank you, Akshay. I will now walk you through Bakkt’s first quarter KPIs and financial results. As a reminder, in accordance with GAAP, we present crypto services revenue and crypto costs and execution clearing and brokerage fees on a gross basis as we are a principal in the crypto services we provide our customers. By contrast, we are an agent in the loyalty redemption services we provide our loyalty customers. Therefore, loyalty revenue is presented on a one-line net basis. Starting on Slide 20, I'll walk you through our Q1 KPIs, which provide insight into the underlying trends driving our business. We concluded the first quarter with 6.8 million crypto-enabled accounts, demonstrating continued steady growth over the past 12 months despite the broader market volatility. Regarding transacting accounts, we recorded a total of 777,349 active accounts in the first quarter, segmented into 377,679 loyalty redemption accounts and 399,765 crypto trading accounts. While this represents a sequential decline from Q4 2024, it aligns with the broader crypto market's cooling period following the exceptional activity we experienced in the fourth quarter, driven by post-election optimism. The year-over-year comparison is relatively flat. As Andy highlighted earlier, our notional volumes reflected the market's moderation after last quarter's record-breaking performance. Total notional volumes in Q1 reached $1.21 billion, comprising $1.06 billion from crypto trading and $153 million from loyalty redemptions. Our crypto volumes underperformed market benchmarks on a sequential basis that outpaced the market on a year-over-year comparison, demonstrating our resilience over longer timeframes. Loyalty redemption volumes declined both sequentially and year-over-year. Finally, assets under custody at our custodian partners for our brokerage business totaled $1,873,000,000 at quarter end. This represents an 18.7% decrease from the previous quarter, but a 52.5% increase year-over-year, with movements primarily driven by fluctuations in underlying crypto asset prices rather than significant changes in customer holdings. On slide 21, we show our total revenue broken out between crypto and loyalty products. Total revenue for the first quarter of 2025 was $1.08 billion, up 25.8% year-over-year, and down 40.2% sequentially. Gross crypto services revenue for the quarter was $1.07 billion, up 27.7% year-over-year, and down 40.3% sequentially. As noted earlier, the sequential decline in gross crypto services revenue reflects the market's moderation after a record-breaking performance in the fourth quarter of 2024, while year-over-year increase demonstrates the improved market sentiment that we have seen in crypto since the fourth quarter of 2024. Crypto services revenue, net of crypto costs, and execution clearing and brokerage fees, or ECB, totaled $3.5 million, reflecting a 5.4% decrease year-over-year, and a 47.8% decrease sequentially. Net loyalty revenues were $9.2 million, down 30.3% year-over-year, and 17.1% sequentially. Of this amount, loyalty transaction revenues contributed $5 million, while subscription and services revenues were $4.2 million. The year-over-year decline was primarily related to the exit of a loyalty client in 2024, as well as reduced volume space, service revenue, and transaction volume. Moving to Slide 22. Total operating expenses for the quarter were $1.09 billion, including $1.06 billion of crypto costs and ECBs, which are correlated to crypto trading volumes. SG&A expenses were $3.8 million, down 51.3% year-over-year, and 19.1% sequentially, driven by reductions in insurance, marketing, and promotion and occupancy costs. Total compensation expense was $17.8 million, down 27.3% year-over-year, and up 17.1% sequentially. The year-over-year decline reflects lower salaries, wages, and benefits driven by our restructuring actions in 2024. The sequential increase in compensation expense is driven by a migration away from cash bonuses towards stock-based incentive compensation. Our Q4'24 results included a $4 million reversal of cash bonus accrual, reflecting the change in compensation strategy that did not repeat in Q1'25. Turning to Slide 23. We present our condensed profit and loss statement. Net income for the quarter was $16.2 million, up 176.5% year-over-year, improving from a loss of $21.3 million for the last year. $8.5 million was attributable to the mountain controlling interest in the operating company, and $7.7 million was attributed to backholding, resulting in an income of $1.18 per basic share on an average share base of 6.4 million shares. On Slide 24, we have our condensed balance sheet as of March 31, 2025. We ended the quarter with $23.0 million of cash and cash equivalents, and $22.8 million in restricted cash. Including, after taking into account the $5 million draw on the ice line of credit in the quarter, cash and cash equivalents decreased by $16.0 million in Q1. Excluding the $5 million draw on the ice line of credit, we utilized $23.1 million of available cash in the first quarter of 2025. As Andy mentioned, the sale of our trust business is now presented as an asset held for sale on the balance sheet, the $3.5 million. The closing of transaction is expected to occur on or about May 15. On Slide 25, we have our adjusted EBITDA for the first quarter of 2025. Adjusted EBITDA reflects adjustments for certain non-cash, infrastructuring, and transaction-related items that impacted this period. Adjusted EBITDA for the first quarter of 2025 was a loss of $14.5 million. The year-over-year improvement in adjusted EBITDA loss, which narrowed by 11%, was primarily due to the overall decrease in compensation and benefits in SG&A expenses, partially offset by an increase in professional fees. Thank you, everyone. That concludes the prepared remarks section of our first quarter 2025 earnings call. I will now pass it back to Cody for closing.

Thank you, Karen, Andy, Akshay, and everyone for attending our earnings call. We look forward to connecting with you again soon.

Ladies and gentlemen, this concludes our event. You may now disconnect. Thank you.

Greetings, and welcome to the Bakkt Fourth Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen only mode. As a reminder, this conference call is being recorded. I will now turn it over to Cody Fletcher, Investor Relations Advisor at Bakkt. Please go ahead.

Hello, everyone. Thank you for joining Bakkt's fourth quarter and full year 2024 earnings call. Before we get started, I'd like to remind everyone that today's earnings call includes a separate supplemental presentation that can be found at our Investor Relations website at www.investors.bakkt.com. During today's call, we will make certain forward-looking statements, including, but not limited to statements regarding the company's guidance for the first quarter of 2025, the company's strategic realignment to become a crypto focused business, the expected impacts of the company's partnership with DTR and other statements regarding the prospects and expectations of the company. These statements are based on management's current expectations and are subject to risks and uncertainties which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. For a more complete discussion on forward-looking statements and the risks and uncertainties related to Bakkt's business, please refer to its filings with the Securities and Exchange Commission, including its annual report on Form 10-K. Further, in addition to discussing results that are calculated in accordance with generally accepted accounting principles, we also make reference to certain non-GAAP financial measures. For more detailed information on our non-GAAP financial disclosures, please refer to our earnings release, which can be found on our Investor Relations website. Thank you. And I'll now turn the call over to Andy.

Thank you, Cody. And hello, everyone. Thanks for joining Bakkt's fourth quarter and full year 2024 earnings call. It's great to connect with you all again. With me today is Karen Alexander, our Chief Financial Officer. To lead us off, we at Bakkt are undertaking a strategic transformation to a crypto future focus and to become a pure play crypto infrastructure company. To begin that transformation, I'm thrilled to announce that Akshay Naheta, the CEO and Founder of Distributed Technologies Research, or DTR, a cutting edge financial technology company, on a mission to build the next generation of global payments, and I will be co-CEO for Bakkt starting on March 21, 2025. In connection with Akshay joining the company, he has brought to the table a new commercial partnership that, subject to applicable regulatory approvals, will tie Bakkt and DTR together to allow Bakkt to enter the cross border stablecoin payments industry. Akshay is a seasoned veteran in fintech, payments, and cutting edge tech investments with a vision to simplify financial transactions through the creation of an advanced global payments infrastructure. He brings over 20 years of experience with an integral understanding of blockchain, financial markets, and payment systems. Previously, he held senior executive roles at SoftBank, where he spearheaded numerous technology investments. Prior to that, he led the proprietary trading business at Deutsche Bank. We are thrilled to welcome Akshay to the team. For context on why we believe this commercial agreement has the potential to be a pivotal addition, in 2024 we witnessed a breakout moment for stablecoins, processing over $5 trillion in adjusted volume across nearly 200 million accounts, according to Pantera Capital. With the recent US administration support for strengthening the dollar's role in global trade through stablecoins, we're aiming to position ourselves at the forefront of this multitrillion dollar opportunity. Through this commercial partnership, once we complete the applicable regulatory approval process, we will integrate a powerful, ready to scale and tested stablecoin payments infrastructure stack. By combining DTR's cutting edge stablecoin infrastructure with Bakkt's regulated high performance trading platform, we'll enable customers to seamlessly on ramp into crypto and then move within the Bakkt technology stack into the rapidly growing payments ecosystem. This integration is expected to create a uniquely powerful offering for our clients, allowing us to build PDP payment capabilities on a global scale, while expanding into additional financial services such as treasury management and payroll solutions. Our clients will benefit from a versatile storefront addressing both their crypto trading and everyday payment needs. Another important piece of this partnership is a put call option whereby Bakkt will have the right to buy DTR or DTR may obligate Bakkt to buy DTR within a price range upon the satisfaction of certain milestones. The commercial agreement is designed to leverage our combined infrastructure to create a global payments network once we clear the applicable regulatory approvals. As a U.S. regulated publicly traded company with rigorous financial and security oversight, we offer institutions a safe and trusted environment for responsible crypto trading and payments processing. We believe the differentiation resulting from our partnership with DTR will open up a scalable revenue model opportunity in the multitrillion global payments space, expanding our obtainable market, while delivering a comprehensive suite of crypto and stablecoin native solutions for our institutional client base. Our commitment to regulatory compliance and security positions us uniquely in this rapidly evolving market. For more information on this commercial agreement, please refer to the press release distributed earlier today. To further advance our transformation to become a pure play crypto infrastructure company, on Monday this week, we reached a definitive agreement to sell Bakkt Trust Company, our qualified custodian subsidiary, to Intercontinental Exchange. Additionally, we are exploring strategic alternatives for our loyalty business. These decisions represent the next stage in our initiative to focus on our core competitive advantages in crypto brokerage and institutional trading services. The digital asset custody landscape has undergone significant changes in the recent year, marked by increased competition, margin compression, and evolving regulatory requirements. Notably, the repeal of the SEC SAB 121 has removed a major barrier for banks to enter the crypto custody space, intensifying the competitive landscape. By divesting Bakkt Trust, we will be better able to concentrate our resources on areas where we believe we have competitive advantages to drive growth. This move allows us to streamline our operations and further improve our cost structure. We expect the sale to reduce the operating expenses by additional $3.8 million annually and free up approximately $3 million in capital that is currently held for regulatory reserves, allowing us to reinvest in our core crypto business and fuel our growth initiatives. Importantly, I want to emphasize that this transaction does not impact the custody solutions we provide to our partners and clients. We have built a robust network of reputable custody providers that will continue to support our customers' asset safekeeping needs. For our brokerage clients, we expect it will remain business as usual without interruption as we finalise the Bakkt Trust sale. As we move forward to a pure play crypto focused future, our business model focuses on supporting clients throughout their entire lifecycle in the crypto ecosystem. We will concentrate on three key priorities. First, expanding and deepening client relationships by supporting new entrants with our Bakkt crypto services platform, and once we have obtained the applicable regulatory approvals, extending into the stablecoin payments market through our commercial partnership with DTR. Second, increasing our commercial and operational effectiveness to drive profitability by streamlining processes and optimising our infrastructure. And third, maintaining our best-in-class risk and compliance foundation while exploring strategic growth opportunities through partnerships with overseas exchanges and disciplined capital allocation to accelerate our product roadmap. These strategic moves were the result of a thorough review process where we evaluated our business portfolio to determine how to most effectively allocate resources and position back for long term success. We continue to remain focused on capitalising on the significant market opportunity we believe is before us, especially as we deepen our focus on crypto's future. Turning to our Q4 performance, as we anticipated on our last call, the positive momentum in crypto trading volumes that began in November continued through the end of the year. This was driven by a dramatic positive shift in crypto environment following the US presidential election. In the fourth quarter, we saw significant growth in all our KPIs in our crypto business, such as notional trading volume, transacting accounts and revenue. Our monthly notional trading volume achieved record highs in November and finished the year strong in December, bringing our fourth quarter total trading volumes to $1.78 billion. This was a 465% improvement sequentially, outpacing the market by 360%. Year-over-year trading volumes grew 778%, outpacing the market by 600%. This strong traction in our crypto business helped drive strong revenue growth and helped us to further close quarterly net loss. For the quarter, total revenues net of crypto costs, execution, clearing and brokerage fees increased 6.6% year-over-year to $17.8 million. Total operating expenses, excluding crypto costs and execution, clearing and brokerage fees, decreased 69% year-over-year to $29.5 million. Net loss improved 48.7% year-over-year to $40.4 million. Adjusted EBITDA loss measured in non-GAAP improved 66.3% year-over-year to $6.4 million. For the full year, total revenues net of crypto costs, execution, clearing and brokerage fees increased 8.8% to $63 million. Total operating expenses excluding crypto costs and execution, clearing and brokerage fees decreased 45.4% to $155.9 million. Net loss improved 54.2% to $103.4 million. Adjusted EBITDA loss, non-GAAP, improved 31.6% to $64.2 million. From an operational standpoint, in 2024, we form BakktX principally in connection with our planned launch of an institutionally focused trading platform known as an electronic communications network or ECN and advanced trading infrastructure. Through our license with Crossover Technologies, we've implemented their proprietary matching technology that allows for smart order routing and trade matching. Currently, BakktX order matching technology is being utilized by our in-house retail facing principal brokerage Bakkt Crypto Solutions to offer US clients and their customers more competitive crypto asset pricing with greater efficiency, reliability, and scalability. We are also in the process of adding service offerings to BakktX that will facilitate direct institutional integration, enabling leading global crypto institutions to access highly competitive and customizable liquidity for their retail-facing markets. BakktX is currently operational in the U.S. in all states except New York, where it remains subject to regulatory approval. We believe this deployment enabled us to effectively handle the recent surge in trading volumes while maintaining 100% uptime. Given the immediate opportunities to support the rapidly expanding U.S. retail crypto market and BakktX's problem capability to service that market, we paused our efforts to integrate a third-party, central counterparty, clearing partner, or other risk management solutions, while continuing to develop service offerings that will facilitate direct institutional integration with highly competitive and customizable liquidity options. Another significant contributor to our exceptional notional volume performance was the strategic addition of new supported coins. In Q3, we introduced nine new coins, followed by three more in Q4, and most recently we listed President Trump's native token in Q1 of this year. Our team actively monitors market trends and identifies promising tokens to stay ahead of the curve. By continuously expanding our offerings and providing users with access to the most sought after coins, we aim to maintain high levels of engagement and attract new users to our platform. I want to address an important client update. We have received notification from Webull that they will not be renewing their existing contract effective middle of June 2025. As their business has scaled and evolved, they're modifying our contract to run more of their own infrastructure and operations. This transition aligns with the client lifecycle approach I outlined earlier where clients may scale beyond from our comprehensive brokerage solutions as they mature potentially shifting to our direct institutional offerings and liquidity services. Webull represented approximately 74% of our crypto revenues for 2024. However, we continue to have a very strong relationship with Webull. We are working closely with their team to ensure a smooth transition for their brokerage infrastructure and we are exploring alternative ways to continue to work together as their business scales. While this change will impact our revenue in the short term, it reinforces the importance of our strategic initiatives that I discussed earlier as we continue to support Webull's strategy. Turning now to Page 6, I'd like to review our 2024 strategic priorities and how we executed on them. First, expanding our client base and strengthening our partnerships was a core focus throughout the year. We formed relationships with a diverse set of companies that enhance our capabilities and our core crypto brokerage and institutional trading by providing complementary strengths such as advanced trading infrastructure and high performance matching engines. These relationships are setting a strong foundation for our business and help position Bakkt as a player in the crypto market. Our second strategic priority was to broaden our suite of products and services to better serve our clients' evolving needs. Throughout 2024, we made significant enhancements to our ecosystem, expanded support to digital assets, introduced advanced order types, and incorporated algorithmic trading tools and smart order routing. We also made targeted investments in retail focused offerings, adding support for 15 new coins on our crypto brokerage platform. We will continue to strategically add new products and features that we believe can drive incremental volume and revenue. Finally, we focused on continuously improving our cost structure and operational efficiency. I'm pleased to report that this is an area where we made significant strides over the course of the year. We streamlined operations across the organization, which led to operating expenses decreasing by 65.8% year-over-year on a run rate basis as of Q4, and establishing a leaner and more efficient business. As we look ahead, we remain committed to running our business in a disciplined manner, and we'll continue to look for opportunities to save on costs and drive profitability as we guide ourselves into a focused future in the crypto ecosystem. I'd like to thank the team for their focus and commitment in a dynamic year as we position Bakkt for the future. Moving to Slide 7, I want to highlight the favorable macro conditions for the crypto industry as we enter 2025. The year 2024 was remarkable for crypto adoption and sentiment with positive catalysts and tailwinds converging. Bitcoin and other major coins reached new all-time highs, driven by surging institutional adoption and anticipation of a more crypto friendly regulatory environment under the new US administration. These price increases have reignited retail interest and mainstream media coverage. The election of pro crypto president Donald Trump marked a watershed moment for the industry. Since taking office he has taken significant steps to provide regulatory clarity and support innovation including repealing SAB 121 which seemingly had the effect of discouraging banks from offering crypto services, and establishing a strategic National Digital Asset Stockpile to hold digital assets. The SEC's formation of a dedicated crypto task force, led by Commissioner Hester Pierce, signals a major shift forward towards developing a comprehensive regulatory framework. We look forward to working with the task force to shape the future of crypto regulation. Another notable development was the launch of President Trump's native token, Trump, currently available on our platform, demonstrating the administration's commitment to embracing crypto. As we look ahead in this favorable environment, we remain focused on our strategy to bring the most cutting-edge digital asset trading solutions to clients throughout their entire crypto journey and reinvent ourselves with a crypto future focus. This approach aligns with the increased institutional adoption and renewed retail interests we're seeing in the market. Our client lifecycle model enables us to support businesses from their initial market entry with our comprehensive DCS platform through their evolution with solutions like BakktX to institutional trading services as they mature. We continue to pursue bringing some of the biggest crypto market makers onto our platform, improving liquidity and driving additional demand. Partnership discussions are ongoing, our volumes have improved, and our strategic focus on supporting clients throughout their entire lifecycle is positioning us well to capitalize on the current crypto-friendly regulatory environment. With that, on Slide 8, I'd like to outline our three key strategic priorities for 2025 as we accelerate our transformation into a pure play crypto leader. First, we aim to expand and deepen our client relationships throughout their entire lifecycle in the crypto ecosystem. By supporting clients from market entry through maturity, we strive to capture opportunities at every stage of development. We'll focus on supporting new entrants with a comprehensive Bakkt Crypto services platform, offering streamlined trading solutions for evolving businesses and providing institutional trading and liquidity services for established players. With our commercial partnership with DTR, we expect to expand beyond traditional crypto trading solutions into the stablecoin payments market, significantly increasing our addressable market to include the cross-border payments ecosystem. Second, we plan to increase our commercial and operational effectiveness to drive profitability. We are committed to streamlining client acquisition, onboarding, solutioning, and revenue realization processes to increase our trading margins. As clients mature beyond our comprehensive brokerage solutions to our institutional trading platforms, we can capture higher margin opportunities with reduced operational requirements. Our operational infrastructure is being optimized to efficiently handle increasing transaction volumes, while maintaining a seamless experience for our clients. We believe the divestiture of Bakkt Trust and exploration of strategic alternatives for our loyalty program will further reduce our operating expenses and streamline our business model. We believe the operational efficiencies from our commercial partnership with DTR will enhance our ability to deliver innovative solutions, positioning us well to drive operating leverage as we work to continue to grow our revenues. Third, we will maintain our best-in-class risk and compliance foundation, while exploring strategic growth opportunities. As a trusted partner to our clients, we understand the critical importance of robust risk and compliance frameworks in the evolving crypto regulatory landscape. The complementary regulatory expertise from both Bakkt and DTR will create a powerful foundation for our expansion in both domestic and international markets. We will continue to explore partnerships with overseas crypto exchanges, looking to enter the US market compliantly, leveraging our regulated infrastructure to help them navigate the complex landscape. The company will maintain a disciplined approach to capital allocation, focusing on high return organic investments and opportunistic M&A that we believe will accelerate our product roadmap and add complementary capabilities to our strategy, particularly in the areas of trading technology and payments infrastructure. Underlying these strategic priorities is our commitment to building culture that is client-focused, commercially driven, yet risk smart and agile in execution. By aligning our crypto driven future focus organization around these values, we believe we are well positioned to achieve our objectives and aim to deliver long-term value to our clients and shareholders. I'd like to thank you for your time. It's been a pleasure to update you on Bakkt from both a high-level financial and operational perspective. I will now hand it over to our CFO Karen for a deeper dive into the numbers. Karen?

Thank you, Andy. I'll now walk you through our fourth quarter KPIs and financial results. As a reminder, in accordance with GAAP, we present crypto services revenue and crypto costs and execution clearing and brokerage fees on a gross basis, as we are a principal in the crypto services we provide our customers. By contrast, we are an agent in the loyalty redemption services we provide our loyalty customers. Therefore, loyalty revenue is presented on a one line net basis. Starting on Slide 10, we have our Q4 KPIs, which provide a snapshot of the underlying trends driving our business. We ended the fourth quarter with 6.7 million crypto enabled accounts, reflecting steady growth over the past 12 months and a slightly larger increase from Q3 to Q4, partially due to a migration onto our platform from customers at our partner, Swan, in December of last year. Next, we have our transacting accounts, broken down between crypto and loyalty accounts. There were 974,429 transacting accounts in the fourth quarter, of which 556,176 accounts were related to loyalty redemption and 418,253 were related to crypto trading. Similar to crypto enabled accounts, one of the key drivers for the substantial increase in trading volume from Q3 to Q4 was the successful migration of customers from our partner Swan to our platform. In December, we witnessed a significant spike in activity with 50,000 customers finalizing their migration to Bakkt. We believe this influx of new users was a good indicator of the trust and confidence that Swan has in our platform. As Andy mentioned earlier, we saw a significant increase in our fourth quarter notional crypto volumes after the election of President Trump and experienced a record breaking quarter for crypto volumes. Our total notional volume for the quarter was $1.99 billion with $1.78 billion from crypto and $216 million attributable to loyalty reduction. In crypto, we outpaced the market both sequentially and year-over-year. And our loyalty redemption volume increased 33.8% sequentially. We hope to see this trend continue as market sentiment for crypto continues to improve and the regulatory environment affects more crypto-friendly policies. Lastly, assets under custody at our custodian partners for our brokerage business reached $2.3 billion, up 145.2% from the previous quarter of $938.7 million, and up 228.1% year-over-year, driven by higher coin prices. On Slide 11, we show our total revenue broken out between our crypto and loyalty products. Total revenue for the fourth quarter of 2024 was $1.8 billion, up 447.3% sequentially, and 737.9% year-over-year. Gross crypto services revenue for the quarter was $1.8 billion, up 464.7% sequentially, and 795.3% year-over-year. This growth reflects the improved market sentiment for crypto that we saw in the fourth quarter. Crypto services revenue net of crypto costs and execution clearing and brokerage fees totaled $6.6 million, reflecting a 407.7% increase sequentially and a 288.2% increase year-over-year. It is important to note that the smaller increase year-over-year was primarily due to Bakkt benefiting from a temporarily higher take rate resulting from the one-time adjustment to the revenue share agreement with Webull in the third and fourth quarters of 2023. As Andy mentioned earlier, Webull has notified us that they will not be renewing their existing contract when it ends mid-June 2025. In 2024, Webull was $2.56 billion of our gross crypto services revenue. Net loyalty revenues were $11.1 million, down 8.3% sequentially and 26.5% year-over-year. Of this amount, loyalty transaction revenues contributed $6.8 million, while subscription and services revenues were $4.3 million. The year-over-year decline was primarily related to reduced volume-based service revenue, partially offset by increased transaction volume. Moving to Slide 12, total operating expenses for the quarter was $1.81 billion, including $1.78 billion of crypto costs and execution, clearing, and brokerage fees. The increase in these variable costs was in line with the strong growth in crypto trading volume. SG&A expenses were $4.7 million, down 44.7% sequentially and 59.8% year-over-year, driven by a reduction in insurance costs and marketing and promotion. Total compensation expense was $15.2 million, down 6.2% from last year, primarily due to lower salaries, wages, and benefits from our restructuring efforts in 2024. Turning to Slide 13, we present our condensed profit and loss statement. Net loss for the quarter was $40.4 million, improving 48.7% year-over-year. $21.2 million was attributable to the non-controlling interest in the operating company and $19.2 million attributable to Bakkt Holdings, resulting in a loss of $2.95 per share on an average share base of 6.5 million shares for both basic and diluted. And on Slide 14, we have our full year 2024 condensed profit and loss statement. Net loss for the year was $103.4 million, improving 54.2% year-over-year. $56.8 million was attributable to the non-controlling interest in the operating company, and $46.7 million attributable to Bakkt Holding, resulting in a loss of $7.97 per share on an average share base of 5.9 million shares for both basic and diluted. On Slide 15, we have our adjusted EBITDA for the fourth quarter of 2024. Adjusted EBITDA reflects assumptions for certain non-cash restructuring and acquisition-related items that impact the period. Adjusted EBITDA for the fourth quarter of 2024 was a loss of $6.4 million. The year-over-year improvement in adjusted EBITDA loss, which narrowed by $12.6 million or 66.3%, was primarily due to the overall decrease in compensation and benefits expense and marketing expense. On Slide 16, we have our condensed balance sheet as of December 31, 2024. We ended the quarter with $39.0 million of cash and cash equivalents and $24.9 million in restricted cash. Cash and cash equivalents increased by $3.3 million in Q4, and we utilized $7.1 million of available cash in the fourth quarter, including $700,000 for restructuring expenses. Moving on to our outlook on Slide 17. Moving forward, we're amending our outlook process to only provide guidance on a quarterly basis, which aligns to industry standards given the volatile nature of crypto. All of the following are estimated values and do not include any estimated revenues or expenses from the newly announced commercial partnership with DTR. For Q1, we anticipate total revenues to be in the range of $1.03 billion and $1.28 billion, comprised of gross crypto revenues of $1.02 billion to $1.27 billion in net loyalty revenues of $8.5 million to $9.9 million. We expect crypto costs and execution clearing and brokerage fees or ECB to be $1.02 billion to $1.27 billion, in line with our gross crypto revenue estimates and expect to end the quarter with $22 million to $26 million in available cash and cash equivalents. Our projected ending cash balance includes a potential first-time draw of up to $5 million from the ICE line of credit by the end of March to support working capital requirements and does not include sale consideration or released capital from the divestiture of custody. We intend to minimize our utilization of the ICE credit line, using it only as a short-term bridge to address immediate capital needs when needed. Thank you everyone. That concludes the prepared remarks section of the Q4 2024 earnings call. I'll now pass it back to Cody for closing.

Thank you Karen, Andy, and everyone for attending our earnings call. We look forward to connecting with you again soon.

This concludes today's conference call. Thank you for your participation. You may now disconnect your line.

Greetings, and welcome to the Bakkt Third Quarter 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference call is being recorded. I will now turn the conference over to [Cody Fletcher] (ph), Investor Relations Advisor at Bakkt. Please go ahead.

Good morning, and thank you for joining Bakkt’s third quarter earnings call. Before we get started, I’d like to remind everyone that today’s earnings call includes a separate supplemental presentation that can be found at our Investor Relations website at www.investors.bakkt.com. During today’s call, we will make certain forward-looking statements. These statements are based on management’s current expectations and are subject to risks and uncertainties, which may cause actual results to differ materially from those expressed or implied in such forward-looking statements. For a more complete discussion on forward-looking statements and the risks and uncertainties related to Bakkt’s business, please refer to its filings with the Securities and Exchange Commission. Further, in addition to discussing results that are calculated in accordance with Generally Accepted Accounting Principles, we also make reference to certain non-GAAP financial measures. For more detailed information on our non-GAAP financial disclosures, please refer to our earnings release, which can be found on our Investor Relations website. Thank you, and I’ll now turn the call over to, Andy.

Thank you, Cody, and good afternoon, everyone. Thanks for joining Bakkt’s third quarter 2024 earnings call, and it’s great to connect with you all again. With me today is Karen Alexander, our Chief Financial Officer. Before I jump into our third quarter results, I’d like to begin today by discussing Bakkt’s strategic direction and acknowledging the favorable market conditions and increased trading volumes we and the broader market have seen since the U.S. presidential election on November 5. As you will see on Page 3 of our presentation, an example of our prospects of our trading services correlated to the higher crypto prices, we saw a steady ramp up in Bakkt’s notional trading volume over the past three months. Then in November, leading up to the election and especially following the election, our notional trading volumes dramatically increased. If we look at November’s volumes by day, we saw this increase in reaction to the election results on November 5, and then trading volume went even higher days later along with the broader crypto prices and the new all-time high for Bitcoin. As of November 12, we’ve already traded $279 million in notional volume, already exceeding October’s total volume by $114 million. Compared to the broader market, we’ve achieved 169% of our total October volume in just the first 12 days of November, while the market as a whole has only reached 78% of its October total, demonstrating our potential for strong performance. While we cannot predict future trading volumes, especially in the current environment, we believe the U.S. presidential election results have provided a meaningful tailwind to the crypto industry Bakkt not excluded. Turning now to Page 4, let’s jump into the highlights of our Q3 financial performance, which Karen will give more detail later on. Q3 crypto and loyalty services revenue, net of crypto costs and execution and clearing and brokerage fees, was $13.4 million down approximately 8.8% from Q3 last year. This primarily happened as a result of third quarter and fourth quarter 2023 benefiting from a one-time adjustment to our revenue share agreement with Webull Pay that resulted in a temporary higher take rate, which became normalized at the start of this year. Note that this dynamic will also impact our Q4 2024 year-over-year comps. Sequentially, our results were down 9.5% and reflected softer trading activities, which were seen across the broader market. But as previously noted, we have seen and expect to continue to see trading volumes improvement in Q4. Q3 operating expenditures excluding crypto costs and execution and clearing and brokerage fees were $40.7 million and was 39.7% lower year-over-year driven by our cost reduction initiatives. These actions helped reduce our Q3 operating loss by 48.2% compared to Q3 last year. In October, we completed another reduction in force as part of our continued cost improvement initiatives. Moving on to our crypto business operations, most of 2024 has been a challenging execution environment. That said, with the clarity from the recent election results, we are encouraged that the work we have done positions us well in the new environment. We achieved several milestones during the third quarter that broadened our client network and product offerings for the tailwinds we are seeing in the market. Now, I’ll introduce these accomplishments before diving deeper into our commercial operations. Starting with BakktX, our institutional electronic communication network. This past quarter, we successfully commenced trading on the BakktX platform with Bakkt crypto solutions, Bakkt’s retail facing crypto brokerage business as one of the initial institutional trading clients. This represents the beginning of our broader rollout strategy to institutional clients. This rollout aims to combine the strengths of our strategic partners and the BakktX ecosystem, namely Bakkt security and compliance expertise, crossover markets, high performance technology and sub-10 microsecond matching latency, Hidden Road’s global credit network for institutions and real-time risk management and operational support and our new partner, CoinRoutes, who will provide our clients with the best-in-class trading interface and algorithms. We remain confident BakktX will be a significant growth driver for the Company and we look forward to sharing updates in the near future. Further, we are excited to announce that we recently on-boarded Blockwyre onto our brokerage infrastructure solution. Blockwyre is an AI-driven crypto-fintech infrastructure platform offering banking, custody and payment solutions for B2B and B2B2C customers. Bakkt will provide end-to-end crypto brokerage infrastructure for Blockwyre’s spot crypto and stablecoin payments platform, including liquidity and execution, custody services, fee at management and potential future joint product expansions. This new brokerage client is another demonstration of companies choosing Bakkt as their partner in growth using our preferred trusted platform for buying and selling crypto. As we stated in our Q2 earnings, we recalibrated our go-to-market approach to focus our resources on targeting companies already established in the U.S. and international players coming into the U.S. who may benefit from Bakkt scalable trading capabilities. We are seeing very good results from this recalibration with an expanding sales opportunity pipeline for potential new clients with many such opportunities in advanced stages of the sales process. In August, we successfully introduced nine new coins to our Bakkt crypto solutions platform. The response from our clients has been very positive and many have begun integrating the new coins into their platforms and in Q3, the new coins contributed a notable improvement in our trading volumes for the quarter. We also just launched six additional coins in November and we plan on bringing more coins to market in the future. Furthermore, I’d like to give an update on our Bakkt Trust and Custody operations. In October 2024, we began investigating a possible winddown and dissolution of Bakkt Trust due to its lack of market traction and high cost of capital due to regulatory requirements. As this process has progressed, we have also worked to find strategic alternatives for Bakkt Trust. This decision was carefully considered and represents the next stage of our strategic initiative to focus on our brokerage and institutional trading services where we believe we have unique competitive advantages for sustainable long-term growth. Our decision is timely. When you look at the macro environment, the custody space in general has seen significant margin compression, particularly over the past several quarters along with increased competition from new players and further regulatory reform. This move allows us to focus on our core strengths while also achieving an expected reduction in operating expenses. Additionally, we anticipate a lower regulatory capital requirement during this process, which would free up significant working capital and shows another example of our ultimate goal, maximizing shareholder value. A key point to make with this decision is that our brokerage clients will continue to benefit as they do today from our custody offering enabled by our Custody Solutions partners. So, it’s business as usual and there is no impact to our brokerage clients as we evaluate strategic alternatives to Bakkt Trust. Finally, as you know, Bakkt operates across several complementary yet distinct business areas. Both management and the Board are continually exploring strategic alternatives to maximize shareholder value while advancing our 2024 priorities, Bakkt Trust being a prime example. Turning to Slide 5, next I’d like to review some key regulatory and macro developments that we believe are strong indications that crypto is maturing as an asset class and provides favorable tailwinds for Bakkt going forward. On the regulatory front, we’ve seen meaningful progress this year. Notably, FASB’s adoption of fair value accounting of crypto assets was a pivotal shift in reporting standards for public companies. As I mentioned on previous calls, the launch of Bitcoin and Ethereum spot ETFs has driven record adoption and capital flows in a very short amount of time. And more recently, the SEC’s approval of options trading for BlackRock’s iBIT ETF and on the NYSE has further reinforced crypto’s growing presence in the U.S. capital markets. Meanwhile, we are now seeing that bipartisan support for crypto continues to improve and with Donald Trump as the president-elect, we expect the narrative on crypto to improve even further as he has advocated for a more positive regulatory environment. On the monetary front, the Federal Reserve’s 50 basis point rate cut in September following 11 consecutive hikes and the additional 25 basis point cut last Thursday signal a significant shift in monetary policy. These reductions in the U.S. Federal interest rates have historically served as positive catalysts for risk assets such as crypto. Taken together, these policy shifts create a highly favorable environment for Bakkt, reinforcing our competence in the Company’s strategic direction. Turning to Slide 6, our strategy of building a robust ecosystem of partners to address the institutional market has positioned us to capitalize on the growing opportunities that drive long-term growth. We have put together what we believe to be a unique combination of strengths to launch BakktX, namely Bakkt’s advanced infrastructure with crossover markets high-performance technology, CoinRoutes trading interface and algorithms, and once we have a definitive agreement with them, Hidden Road is a global credit network for institutions. This combination delivers the unique value proposition for institutions giving them high-performance sub-10 microsecond matching latency, customizable liquidity streams and reduced trading costs. The strength of this ecosystem delivers solutions for institutions that are highly competitive against existing crypto trading venues. To wrap up, we are executing and making significant progress on the three strategic priorities that we laid out at the start of the year. First, we are growing our client network and deepening our existing client relationships. On the brokerage side, we’re thrilled to have Blockwyre as a new client on our brokerage infrastructure solution. Additionally, we continue to build momentum with Hidden Road, Crossover Markets and our new partner, CoinRoutes, which demonstrates our commitment to growing our institutional client-base while deepening relationships with existing partners. We believe these collaborations enhance our offerings and position Bakkt as a critical player in the broader digital asset ecosystem. Secondly, we are expanding our product solutions and extending the Bakkt ecosystem. With the upcoming rollout of BakktX, we are finalizing our high performance platform to cater to the needs of institutional investors. This is demonstrated through our partnership with Blockwyre using our end to end infrastructure for their crypto payment processing and brokerage services. These milestones reflect our ongoing commitment to innovation and creating best in class solutions that meet market demands. Lastly, we continue to improve our cost structure, ensuring that we operate efficiently while scaling our business. The integration of new strategic partnerships and our disciplined approach to cost management are already yielding improved results without compromising the high level of service and innovation we deliver for our clients. Thank you for your time. It’s been a pleasure to update you on Bakkt from both a high level financial and operational perspective. I will now hand it over to our CFO, Karen, who will review our financial performance for the third quarter in more detail. Karen? Karen Alexander Thank you, Andy. I will now walk you through our third quarter KPIs and financial results. As a reminder, in accordance with GAAP, we present crypto services revenue and crypto costs and execution clearing and brokerage fees on a growth basis as we are a principal in the crypto services we provide our customers. By contrast, we are an agent in the loyalty redemption services we provide our loyalty customers. Therefore, loyalty revenue is presented on a one line net basis. Starting on Slide 9, we have our Q3 KPIs, which provide a snapshot of the underlying trends driving our business. We ended the third quarter with 6.5 million crypto enabled accounts, reflecting a steady increase over the past 12 months. This growth further underscores the increasing adoption and trust in our platform. Next, we have our transacting accounts broken down into crypto and loyalty accounts. There were 610,568 transacting accounts in the third quarter, of which 417,000 were related to loyalty redemptions and 193,000 were related to crypto trading. Total initial traded volume was $476.5 million with $314.9 million attributed to crypto and $161.6 million attributed to loyalty redemptions. Crypto notional traded volume was down 36.2% sequentially, but up 64.9% year-over-year. As Andy mentioned at the beginning of the call, we saw a 56.3% increase in notional volume month over month from September to October this year, surpassing the market average by 40.8% and have already achieved 169% of our October volume in the first 12 days of November. We hope to see this trend continue as market sentiment for crypto becomes more positive. As Andy also highlighted earlier, during the quarter, we enabled nine new tokens for trading on our brokerage platform for our clients. These new tokens demonstrated strong trading activity immediately and contributed approximately 10% to our September overall trading volume. We also added an additional six coins in November and believe our expanded listings that our clients’ customers can trade increases end user engagement, improves liquidity, and attracts more customers onto our clients’ platforms. And lastly, assets under custody at our custodian partners for our brokerage business were $938.7 million down from the previous quarter of $974.5 million driven by slightly lower coin prices. On Slide 10, we show our total revenue broken out between our crypto and loyalty products. Total revenue for the third quarter of 2024 was $328.4 million. Gross crypto services revenue for the quarter was $316.3 million an increase of 65% from the same quarter last year. This growth trended with the overall market as overall crypto interest has increased since last year. Our crypto services revenue net of crypto cost and execution clearing brokers fees totalled $1.3 million reflecting a 20.9% decrease compared to the same period last year. As Andy mentioned earlier, this decline was primarily due to the second half of 2023 benefiting from a temporary one-time adjustment in our revenue share agreement with Webull that resulted in a higher than normal take rate, which reverted back to normal rates at the beginning of 2024. Our net loyalty revenues were $12.1 million down 7.2% year-over-year. Of this $12.1 million loyalty transaction revenues were $6.0 million and subscription and services revenues were $6.1 million. The majority of the decline in net loyalty revenue was driven by a decline in transaction revenue. Moving on to Slide 11, we have our total operating expenses. Total expenses for the quarter were $355.8 million including $315.0 million of crypto cost and execution clearing and brokerage fees, driven by higher trading volumes. SG&A expenses were $8.5 million up 14% from Q3 2023 and 54.6% sequentially due to a $1.1 million settlement payment made in July of 2024 to terminate a five year strategic marketing agreement entered into in 2023. The settlement payment released us from future obligations under the agreement. Total compensation expense is $21.1 million down 14.3% from last year due to lower headcount and incentive bonuses. We continue to prioritize cost savings initiatives and have made significant strides in optimizing our expense structure. On Slide 12, we have our EBITDA and adjusted EBITDA for the third quarter of 2024. Adjusted EBITDA reflects adjustments for non-cash restructuring and acquisition related items that impacted the period. EBITDA and adjusted EBITDA for Q3 2024 were losses of $7.3 million and $23.7 million, respectively. Adjusted EBITDA loss for third quarter 2024 increased by $2.1 million or 9% compared to Q3 last year, primarily as a result of the temporary higher take rate from Webull in the second half of 2023 and lower loyalty revenue. Turning to Slide 13, we present our condensed profit and loss statement. Net loss for the quarter was $6.3 million of which $3.4 million was attributable to the non-controlling interest in the operating company and $2.9 million was attributable to Bakkt Holdings, resulting in a diluted loss of $0.45 per share on an average diluted share base of 6.4 million shares for both basic and diluted. On Slide 14, we have our condensed balance sheet as of September 30, 2024. We ended the quarter with $35.7 million in cash, cash equivalents and available for sale securities and $35.3 million in restricted cash. We utilized $25.0 million of available cash in the third quarter of 2024. The third quarter included several annual and one-time payments, including $3.8 million for annual insurance premiums and a $1.1 million settlement payment associated with the termination of a strategic marketing agreement that I referred to earlier. Additionally, $1 million was used to increase restricted cash driven by reserves needed to support higher trading ACH volumes. Moving on to Slide 15, we have an adjustment to our full-year 2024 outlook from the previous quarter. We are seeing a lower forecasted loyalty revenue range of $49 million to $50 million, missing the lower end of our range by $4 million and the higher end of our range by $7 million. We’ve seen a downward trend in the loyalty business this year, which is primarily driven by lower transaction volume. Also, we now expect the crypto net revenue contribution to be at the low end of the range of $10 million to $15 million we provided last quarter. This guidance does not include an expectation of material revenue from back debts in 2024. Our cash utilization for the remainder of the year will be higher than previously guided due to the production of expected revenue and higher expenses. We expect to end the year with $34 million to $39 million of available cash, cash equivalents and available for sale securities. After consideration of the possible wind down and dissolution of Bakkt Trust and the lower regulatory capital requirements we expect. Our end of year expectation for available cash, cash equivalents and available for sale securities considers our lower revenue expectations for 2024 as well as higher professional services expenses. Thank you, everyone. That now concludes the prepared section of our Q3 2024 earnings call. I’ll now pass it back to Cody for the Q&A session.

Thank you, Karen. Next, we will move over to a couple of questions from the investor community. Our first question from the investor community comes from [Sayed H.] (ph).

What is Bakkt doing to bring its products to the market? There seems to be no enthusiasm from the company itself and nothing as far as announcements. So how can others be excited about you and your products? Andy, can you share your perspective here?

Thank you, Syed, for your question and for being a valued stockholder. I appreciate the opportunity to address this. At that, our priority this year has been clear, delivering innovative, high quality products that meet market demands. Specifically, we’ve concentrated on BakktX, positioning ourselves to capitalize on the growing institutional interest in crypto trading. We’ve been working diligently to refine our current offerings such as the recently announced coin listings as well as introducing BakktX as an entirely new offering. While much of this work happens behind the scenes, it’s all geared towards creating long-term value for our shareholders and establishing Bakkt as a leader in the evolving crypto ecosystem. We understand the desire for more frequent updates, but we are committed to only announcing developments when they are finalized. Rest assured, we are fully focused on building momentum and driving profitability and we appreciate your continued confidence in our efforts.

Thank you, Andy. Our next question comes from [Jeffrey C] (ph).

What is the long term vision for the company? What unique value can Bakkt offer its customers that competitors can’t match? Andy, could you also take this one?

Thank you, Cody, and thank you, Jeffrey, for the question. At Bakkt, our long-term vision is clear, to establish ourselves as a leader in the rapidly evolving crypto ecosystem. We’re laser focused on areas where we can deliver the most value, specifically through our best-in-class retail crypto trading platform and BakktX, our groundbreaking solution tailored for the institutional crypto trading market. We believe the future of crypto and tokenization is bright and our goal is to provide a seamless, secure entry point and crypto trading platform for brokerages and institutions venturing into the space. Our collaboration with industry leaders like Hidden Roads, Crossover Markets, CoinRoutes and Blockwyre demonstrate a shared commitment to driving innovation and long-term value in this dynamic market. What sets that apart is our unmatched security and compliance expertise, our strong network of partnerships across the industry and our commitment to operational efficiency as we’ve discussed today. These pillars reinforce our mission to deliver sustained value to our shareholders in this burgeoning market.

Thank you, Andy, and thank you everyone for attending our earnings call this morning. We look forward to connecting with you again soon.

Ladies and gentlemen, this concludes our event and you may now disconnect.