Overview
- Nakamoto completed the 1-for-40 reverse stock split that took effect on May 22, reducing outstanding shares from roughly 696 million to about 17.4 million to meet Nasdaq’s $1 minimum bid requirement.
- The stock fell sharply after the split and hit an all-time low of $4.70, continuing a collapse from about $34 a year earlier and a low near $0.16 in April.
- Investors reacted negatively because the split changes share math but does not change company value and the company previously registered more than 400 million shares for resale.
- Nakamoto reported a first-quarter net loss despite strong revenue growth and holds about 5,058 Bitcoin, leaving the firm exposed to mark-to-market crypto losses and potential pressure to sell assets for cash.
- Analysts say the episode highlights strain on public bitcoin-treasury firms that rely on equity markets for funding and raises the risk of further dilution or consolidation in the sector.