Long Blockchain’s stock price is in free fall following the announcement that its shares are set to be delisted from the Nasdaq Stock Market.
Shares for the ex-beverage producer (LBCC) — formerly known as Long Island Iced Tea — closed at $1.10 on Wednesday, representing a single-day decline of 37 percent and an 88 percent plunge from their high-water mark in December.
Long Blockchain shares had been trending down since the start of the year, owing to the fact that — like other firms that had made dubious pivots into the blockchain space — it has operated largely as a proxy stock for the cryptocurrency industry.
The trigger for Wednesday’s precipitous decline was the company’s admission the previous day that it had received a letter from Nasdaq informing the firm that it would delist LBCC shares on Thursday.
Long Blockchain will remain a public company, and it has applied to have its shares listed on an over-the-counter (OTC) marketplace, which have less stringent guidelines for the companies they quote but also have less liquidity than a full-featured exchange.
“LBCC will remain a public company following the delisting and its shares will continue to trade publicly,” the company said in a statement. “LBCC’s transition to the over-the-counter market does not diminish the focus of its efforts to become a leader in blockchain technology.”
The delisting was not entirely a surprise. Nasdaq had threatened to delist LBCC shares in February, and though the company had staved this off through an appeals process, it was unable to keep its market cap above the $35 million threshold Nasdaq requires for companies it lists. Following Wednesday’s decline, the company’s market cap is just $12.6 million.
Nasdaq had also expressed concern that Long Blockchain was misleading investors and engaging in otherwise unethical business practices, and the exchange operator cited these concerns as the justification for its decision to delist LBCC on such short notice.
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