Blockchain penny stocks have taken a nosedive this year, right along with the cryptocurrency market. Only one of these penny stocks has seen any sort of price gains in its share price since the beginning of the year.
Investors are still searching for that one blockchain penny stock that will rise from the ashes. Riot Blockchain, Inc (NASDAQ:RIOT) had definite potential but recently hit a huge snag.
Today, it is in a group of penny stocks that are plummeting on the market. Let’s take a closer look as to why that is and if the stock has potential to rebound.
Riot Blockchain on the Hot Seat
Riot Blockchain is headquartered in Castle Rock, Colorado. The company focuses on building, supporting, and operating blockchain technology, specifically through the mining of cryptocurrencies.
The company shifted its focus to crypto and blockchain in October of 2017. Riot Blockchain was formerly known as Bioptix, Inc and currently holds 22 full-time employees.
Nearly a week ago, the US Securities and Exchange Commission (SEC) announced that it is charging multiple firms with microcap fraud. The group charged was led by Barry Honig. Among the individuals named with Honig by the SEC was Riot Blockchain’s CEO, John O’Rourke.
“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.”
Since the news broke, the company has been in a total shambles. Three days ago the company announced that it is restructuring its leadership and ousting O’Rourke, but it hasn’t seemed to help.
Riot Blockchain’s Shares Plummet
Many blockchain penny stocks have taken a nosedive since the beginning of the year, and Riot Blockchain is one of them. Since the start of the year, RIOT is down -86.48%.
Since the announcement of the microcap fraud, RIOT’s shares have dropped -34.8%. According to Yahoo Finance, RIOT is currently trading at $3.77 a share, down -$0.52 (-12.12%).
If Riot doesn’t turn its image around soon, we could easily see its shares hit below a dollar.
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