Bakkt Holdings, Inc.

Greetings and welcome to the BACT Second Quarter 2025 Earnings Conference Call. At this time, all participants are in listen mode only. As a reminder, this conference call is being recorded. I'll now turn the call over to Cody Fletcher, Investor Relations Advisor of BACT. Please go ahead.

Cody Fletcher, Investor Relations Advisor of BACT Hello, everyone, and thank you for joining BACT'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.bac.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 BAC'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 timelines 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 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 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 back 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 re-architecture 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're 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 BAT 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 BAT to unlock its full potential. We took decisive action to streamline our operations, reducing costs, exiting non-core 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 BAC, 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 BAC's realignment into a pure-play crypto infrastructure company. During the quarter, we completed the sale of BAC 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 SAAB 121 which allowed larger institutions to enter the crypto custody space. On July 23rd, we entered into a definitive agreement to divest our luxury business to project Labrador Holco LLC, a wholly owned subsidiary of Roman DBDR Technology Advisors Inc. When completed, this transaction will represent the completion of our strategic divestiture initiatives, It 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 backtrust 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 31st, we signed a commercial agreement with DTR, which paves the way for the completion of the integration of our systems with DTRs. 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 30th, 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 actually we'll cover in more detail shortly. We're now operating as a leaner, more agile organization focused squarely on the growing trend of visualization of real world assets. It's still early innings, but I believe BAT 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 the effect of the day. I am handing the reins over to Akshay, who will assume the sole seat position to lead back 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 BAC's next CEO. I will remain closely involved as an advisor, focusing on finalizing the loyalty divestiture and offering strategic guidance as BAC enters this exciting phase of growth. I am confident that with BAC's strong regulatory moat and technology infrastructure, under Akshay's leadership, BAC 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 BAC's evolution. With that, I will now turn the call over to Akshay.