Today Bakkt, the offshoot of New York Stock Exchange owner ICE, announced it completed a $300 million Series B round. This follows a $182.5 million Series A at the end of 2018.
The latest investors include Intercontinental Exchange, Microsoft’s M12, PayU, Boston Consulting Group, Goldfinch Partners, CMT Digital and Pantera Capital.
To date, Bakkt is known for its Bitcoin options and futures, which have not attracted massive volumes. With a new focus on consumers, in the summer Bakkt plans to launch a consumer app, targeting use cases such as rewards, in-game assets as well as digital versions of merchant ‘value’ such as Starbucks cards.
This fits with the background of new CEO Mike Blandina who took over as CEO in December. He is the former VP of engineering at Paypal.
A large slice of the Series B proceeds is for the acquisition of rewards company Bridge2 Solutions. In early February, ICE announced it had acquired Bridge2, and Bakkt would use the proceeds of its Series B round to take control of the company from ICE. Around the same time, ICE also considered a bid for eBay, something which attracted many raised eyebrows.
Rewards firm Bridge2 provides a solution for seven of the top ten financial institutions as well as 4,500 loyalty and employee incentive schemes. This includes programs for two US airlines.
Both rewards and in-game assets are recognized as strong blockchain use cases. Although, to date, the enterprise blockchain use case for rewards has been in the background. In contrast, Bakkt wants to enable users to convert rewards, miles and points into cash, cryptocurrency or even in-game assets.
American Express is using blockchain for its rewards program, which is the firm’s largest expense of $10.4 billion in 2019.
Blockchain startup Loyyal recently announced a rewards deal with Emirates. Several other airlines are already using blockchain, including Singapore Airlines, Cathay Pacific, and AirAsia.
