Crypto company's stock plunges on SEC probe

Many companies trying to ride the crypto wave are faring even worse than bitcoin itself.Riot Blockchain's stoc...

Posted: Apr 19, 2018 10:47 PM
Updated: Apr 19, 2018 10:47 PM

Many companies trying to ride the crypto wave are faring even worse than bitcoin itself.

Riot Blockchain's stock has plummeted 77% in 2018. (Bitcoin prices have plunged 40% in 2018.)

The bursting of the bitcoin bubble clearly is hurting Riot Blockchain. But news worsened when the company disclosed to investors Wednesday that it had received a subpoena from the Securities and Exchange Commission.

The stock has fallen more than 10% in just the past two days ... and the worst may not be over.

Riot Blockchain used to be called Bioptix. It made fertility hormones for cows, horses and pigs. And it still does.

But Bioptix changed its name to Riot Blockchain last October and said its new focus "will be as a strategic investor and operator in the blockchain ecosystem with a particular focus on the Bitcoin and Ethereum blockchains."

The stock surged from about $5 a share to a high of $46.20 by December. Then cryptocurrencies, including bitcoin, ethereum, ripple and litecoin, started sinking. It's been all downhill for Riot Blockchain ever since.

Related: SEC suspends trading of once red-hot bitcoin stock

The company said in an SEC filing it "believes that many companies engaged in blockchain and cryptocurrency businesses have received subpoenas from the SEC which presents an additional industry risk."

Riot Blockchain added "the existence of an investigation ... could have a materially adverse effect on the company, its business or operations, and the industry as a whole."

Making matters worse, Riot Blockchain disclosed that the Nasdaq has warned it will delist the company's stock if it fails to hold an annual shareholder meeting soon.

The company said it did not have a quorum of shareholders but hoped to be able do so at a reconvened meeting it plans to hold no later than the middle of next month. But Riot Blockchain said there were no assurances it could get a quorum this time either.

Riot Blockchain is hardly the only company guilty of trying to cash in on the crypto craze.

Eastman Kodak -- yes, the camera and film company -- launched its own KodakCoin.

LongFin, a financial tech firm that recently went public, and initially skyrocketed after announcing that it bought a blockchain microlender, has lost nearly half of its value this year.

A company called Long Blockchain, which used to be known as Long Island Iced Tea, has plunged nearly 90%.

And shares of a small company called Nodechain have dropped by more than 90% this year too. Nodechain got into the cryptocurrency mining business last December. Before that, it was a maker of electronic cigarettes called Vapetek.

That's one reason why the SEC and other regulators around the world are taking steps to crack down on fraud by companies seeking to take advantage of bitcoin mania, particularly those that are trying to raise money through initial coin offerings, or ICOs.

Related: Bitcoin plunges as social media cracks down on ICO ads

In an ICO, a company is selling digital currencies, as opposed to stock, to investors. But these sales are not regulated by the SEC as share offerings are in an initial public offering or IPO.

Regulators aren't the only ones growing more leery of cryptos though. Last month, Twitter banned ads for ICOs and token sales. Google also last month that it will begin restricting some crypto ads in June.

And Facebook announced in January it was prohibiting the sale of ads that "promote financial products and services that are frequently associated with misleading or deceptive promotional practices" -- which included ICOs and bitcoin.

So if the bitcoin bust continues, Riot Blockchain may find the business of helping get farm animals pregnant isn't so bad after all.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 159036

Reported Deaths: 3879
CountyCasesDeaths
DeSoto10563104
Hinds10414204
Harrison7397113
Jackson6655128
Rankin6057107
Lee540396
Madison5120107
Forrest394786
Jones376188
Lauderdale3663147
Lafayette341053
Washington3321108
Lamar301950
Oktibbeha255262
Lowndes252867
Bolivar248084
Panola237353
Neshoba2280122
Marshall225051
Leflore211191
Monroe209778
Pontotoc208131
Lincoln200566
Sunflower194155
Warren183058
Tate180451
Union172926
Copiah170840
Pike166760
Scott161330
Yazoo161340
Itawamba159936
Alcorn159328
Pearl River158969
Coahoma155943
Prentiss154931
Simpson154053
Adams147252
Grenada145445
Leake141844
Holmes134461
Covington130040
Tippah130030
George129525
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Hancock127641
Wayne123024
Attala122834
Marion121447
Tishomingo114043
Chickasaw110732
Newton110529
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Clay96127
Clarke94853
Jasper87023
Stone82015
Calhoun79513
Walthall79330
Montgomery78426
Carroll75515
Lawrence74614
Smith74216
Yalobusha74228
Noxubee73317
Perry68726
Tunica63019
Greene62422
Jefferson Davis59617
Claiborne59216
Amite57615
Humphreys55219
Quitman5107
Benton50418
Kemper48018
Webster47714
Wilkinson40722
Jefferson38312
Choctaw3637
Franklin3635
Sharkey32917
Issaquena1214
Unassigned00

Alabama Coronavirus Cases

Cases: 256828

Reported Deaths: 3711
CountyCasesDeaths
Jefferson34214511
Mobile20299366
Madison13925150
Tuscaloosa13591156
Montgomery12659238
Shelby1095877
Baldwin9163137
Lee792566
Morgan710851
Etowah677467
Calhoun6695121
Marshall665757
Houston548239
DeKalb504738
Cullman472043
St. Clair451857
Limestone447546
Lauderdale436054
Elmore427564
Walker3818111
Talladega374457
Jackson350723
Colbert336443
Blount310043
Autauga287342
Franklin259734
Coffee254115
Dale242054
Dallas232932
Chilton230841
Russell22813
Covington227934
Escambia206131
Tallapoosa189191
Chambers185950
Pike162214
Clarke161819
Marion146136
Winston141924
Lawrence135336
Pickens127720
Geneva12638
Marengo125224
Bibb123938
Barbour120629
Butler118842
Randolph105922
Cherokee105524
Hale99732
Fayette96316
Clay93525
Washington93319
Henry8946
Monroe83811
Lowndes82129
Cleburne79914
Macon76522
Crenshaw72930
Conecuh72414
Lamar7138
Bullock70919
Perry6927
Wilcox64918
Sumter58922
Greene44218
Choctaw43519
Coosa3724
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