It’s been over a month since the former iced tea company changed its name to Long Blockchain Corp. (NASDAQ:LBCC). When Long Island Iced Tea first made the announcement that it would be switching gears to blockchain, the company’s stocks soared over 200%. Ever since Long Blockchain has struggled to prove its intentions were more than just jumping on the crypto bandwagon.
It’s been revealed that one of the main reasons behind the switch was to prevent the beverage company from being de-listed on the Nasdaq exchange. One of the requirements for being listed on the Nasdaq Capital Market is to have at least $35 million in market value of listed securities. In October, Nasdaq warned the Long Island Iced Tea company that it would be de-listed if the company wasn’t able to maintain a market value over $35 million for 10 consecutive business days. The switch to blockchain and subsequent increase to its market cap meant this wouldn’t be a problem for Long Blockchain anymore.
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Until now. When Long Blockchain first claimed to be getting into blockchain, the word “maybe” was tossed around. As in maybe it’ll get into this. Well, that lack of commitment may be coming back to haunt the company now.
The SEC has called out companies making the swap to blockchain without any real right to or plan for doing so. While this doesn’t outright point the finger at Long Blockchain, the former drinks company could certainly be included here. The company has been wishy-washy on blockchain moves and even its announcement that it would be purchasing Bitcoin mining rigs wasn’t enough to convince a lot of people that it was fully invested in this transition.
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Long Blockchain closed on the market today at a decline. The stock is currently trading at $3.10, putting it down $0.28, or 8.28%, from the previous closing price of $3.38. Since January started, Long Blockchain’s stock has been struggling and the lack of blockchain information released by the company led its stock to decline overall. Now, the company’s market cap is resting just above $35 million.
If the company continues to waver and the stock continues to decline, the market cap will fall below Nasdaq’s required market value for listed securities. This means that once again, the company will be in danger of being de-listed from the exchange. And something tells me that this time, blockchain won’t be able to save the day.
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