Riot Blockchain jumped from biotech to blockchain in 2017, which resulted in its stock jumping, as well. Now, the company is being called to the carpet after the U.S. Securities and Exchange Commission (SEC) sent a subpoena, warning Riot that it is facing possible removal from NASDAQ for not adhering to policies.
In a public filing, Riot revealed that the securities regulator wanted to know the amount and classification of the company’s assets. The filing went on to say, “The Company believes that many companies engaged in blockchain and cryptocurrency businesses have received subpoenas from the SEC which presents an additional industry risk. The existence of an investigation of the Company specifically and the industry generally could have a materially adverse effect on the Company, its business or operations, and the industry as a whole.”
Later in the filing, Riot addressed the issue of possibly being delisted from NASDAQ, the tech stock index. Riot mentioned that it had been given a “Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard from NASDAQ.” In order to remain on NASDAQ, companies must conduct an annual shareholders meeting. Riot was supposed to hold the meeting prior to the end of 2017, but failed to comply. NASDAQ has now given the company an extension until May 15, but Riot announced in the filing that it doesn’t believe it will be able to meet the deadline, stating, “There is no assurance that we will be able to garner a quorum for the reconvened meeting. If no shareholders meeting is then held, we will likely be delisted from NASDAQ.”
Riot was previously a diagnostic equipment maker for the biotech industry. When it announced last year that it was getting into blockchain, its stock shot up and more than doubled. Now, as a result of the two announcements, it’s down again. The price fell 5% on Wednesday to $6.91, marking an 85% freefall from the company’s high of $46.20 last December.
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