Overview
- Nakamoto will implement the 1-for-40 reverse stock split at 12:01 a.m. ET on Friday, May 22, consolidating roughly 696 million shares into about 17.4 million post-split shares.
- The company said the split is designed to restore compliance with Nasdaq’s minimum $1 bid-price rule and avoid delisting while leaving market capitalization and business fundamentals the same.
- Nasdaq notified Nakamoto on Dec. 10 that its stock traded below $1 for 30 consecutive business days and the company has until June 8 to hold a share price above $1 for 10 straight trading sessions to regain formal compliance.
- The split is cosmetic and may reduce trading liquidity, create fractional-share cash-outs that force small holders to sell, and increase short-term volatility depending on investor reactions.
- Nakamoto reported a $238.8 million Q1 net loss driven by a roughly $102.5 million mark-to-market hit to Bitcoin; the company holds about 5,000 BTC and has sold coins this year to fund operations, so investors will watch whether management uses the compliance window to improve mining results and finances.