Blockchain penny stocks have become a hot topic within the past year, due to their great risk-reward. However, many of the blockchain stocks have also tumbled this year, right along with the cryptocurrency market, but there are a select few that remain on the top.
Riot Blockchain, Inc (NASDAQ:RIOT) was one of them, until just recently.
Riot Blockchain’s CEO Resigns
Riot Blockchain pivoted to blockchain and cryptocurrency last year, becoming one of many blockchain penny stocks. It currently holds cryptocurrency mining operations and other developed businesses. The company’s current focus is Bitcoin, cryptocurrency mining, and blockchain technology.
On Saturday, it was announced that Riot’s CEO and Chairman, John O’Rourke, had resigned. The resignation follows reports that the US Securities and Exchange Commission (SEC) has charged him with fraud. These charges are currently unrelated to Riot and are instead in connection to other companies.
Riot’s official press release did not specify a reason for his resignation, but it did announce that his CEO position would be replaced by Chris Ensey. The new Chairman of the board will be Remo Mancini.
On Friday, the SEC announced that it would be pressing charges against a group of ten individuals for long-running fraudulent schemes that brought in over $27 million. The SEC brought the action for three “highly profitable ‘pump-and-dump’ schemes” and called those charged “microcap fraudsters.”
The group charged was led by Barry Honig and the SEC claims they manipulated the share price of the stock of three companies in a classic pump-and-dump.
“As alleged, Honig and his associates engaged in brazen market manipulation that advanced their financial interests while fleecing innocent investors and undermining the integrity of our securities markets,” said Sanjay Wadhwa, Senior Associate Director in the SEC’s Division of Enforcement. “They failed to appreciate, however, the SEC’s resolve to relentlessly pursue and punish participants in microcap fraud schemes.”
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Riot Stock Movement
After the SEC announcement, this blockchain penny stock took a huge hit and dropped nearly -25% in a day. Today, it seems the penny stock has begun to rebound slightly after new management was named.
According to Yahoo Finance, RIOT is currently trading at $4.50 a share, up $0.20 (+4.65%).
Featured Image: Pexels/© David McBee
