Long Blockchain is appealing a delisting decision from stock exchange operator Nasdaq which, according to a letter, believes the publicly-traded company misled its investors.
In a Feb. 21 letter, Long Blockchain – one of a number of firms with public securities to ride the recent wave of investor hype around blockchain – wrote that Nasdaq "had determined to delist the company's securities." The reason: Nasdaq, according to the note, is crying foul in light of recent statements issued by the company.
"The notification letter stated that the staff believed that the Company made a series of public statements designed to mislead investors and to take advantage of general investor interest in bitcoin and blockchain technology, thereby raising concerns about the company's suitability for exchange listing," the firm wrote, going on to add:
"The company strongly disagrees with the staff's determination and, accordingly, has appealed to a Hearings Panel. As a result, the staff's notification has no effect at this time on the listing of the Company's common stock, and the stock will continue to trade uninterrupted under the symbol 'LBCC.'"
However, the company remains out of compliance with Nasdaq's rules for market value requirements, so even if it wins the appeal, it runs the risk of being delisted anyway, as previously reported.
To maintain its listing, Long Blockchain's market cap must remain at or above $35 million for at least 10 consecutive business days, though a note on the most recent SEC filing states that Nasdaq can extend this time period up to 20 consecutive business days. The company has until April 9 to maintain this level.
As of press time, Long Blockchain's market cap remained around $31.6 million, according to data from Nasdaq, down some $2 million from earlier in the week. At its height, the price of the company's stock rose to nearly $7 – as of today, it's hovering around $3.
The public filing comes just days after the company announced Shamyl Malik, a board member, was taking over as the company's chief executive after former CEO Philip Thomas stepped down.
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