Long Blockchain, formerly known as Long Island Iced Tea Corp., is in hot trouble. The beverage firm made news months ago when it unexpectedly rebranded itself Long Blockchain. Detractors said that the floundering corporation was attempting to capitalize on the enthusiasm around cryptocurrency. (Read more: Long Island Iced Tea Soars After Rebranding as Long Blockchain.)
Long Blockchain’s stock price surged after changing its name. Nasdaq is now accusing Long Blockchain of deceiving its investors and is attempting to delist the business. (See also: SEC Suspends Trading in Three Blockchain and Cryptocurrency Firms.)
Long Blockchain now “remains out of compliance with Nasdaq’s standards for market value criteria,” according to a CoinDesk investigation. To keep its listing on the exchange, the firm must have a market valuation of at least $35 million for at least 10 consecutive working days.
Market Cap Hovering Below Nasdaq’s RequiredMinimum
Long Blockchain has until April 9 to satisfy these obligations. However, Long Blockchain’s market worth was hovering at $31.6 million early today, a $2 million decrease from earlier in the week. The company’s stock is now trading about $3 per share. The stock traded for more than quadruple that amount at its peak.
Long Blockchain made headlines in December 2017 when it quickly revealed intentions to shift its emphasis from drinks to blockchain. Given the abrupt nature of the change, as well as anomalies in the company’s market value and investor information, Nasdaq believes it has grounds to be worried about the company’s honesty. (See also: SEC May Crack Down on Firms Misusing the Term “Blockchain.”)
Plans to Appeal
Long Blockchain, for one, is not taking the news that Nasdaq intends to delist it from the exchange lightly. The corporation has filed an appeal against the delisting judgment. Long Blockchain thinks Nasdaq “has resolved to delist the Company’s equities,” according to a letter dated February 21.
“The notification letter stated that the Staff believed that the Company made a series of public statements designed to mislead investors and to capitalize on general investor interest in bitcoin and blockchain technology, thereby raising concerns about the Company’s suitability for exchange listing,” the company added.
Long Blockchain said that it “strongly disagrees” with Nasdaq’s judgment and has filed an appeal with a hearings panel. However, due of its low market size, Long Blockchain may still be delisted for other grounds even if company wins the appeal about having deceived investors. (See also: SEC Charges Former Bitcoin Exchange Operator With Fraud.)
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