Greenidge Generation (NASDAQ:GREE) stock is up more than 30% today after the cryptocurrency miner received a delisting notice for failing to maintain a minimum price per share of $1.
New York-based Greenidge has been informed by the Nasdaq index on which it trades that its stock will be delisted if it does not manage to get its share price up above $1 by June 2023. With today’s big gain, GREE stock is currently trading at 33 cents a share. The stock has traded below $1 and has been trending lower since the end of October as a downturn in the broader cryptocurrency market accelerated.
The 52-week low for GREE stock is 25 cents per share. Year-to-date, Greenidge’s share price has declined 98%. In January 2022, the stock was trading as high as $22 a share.
The current crypto winter had been hard on the prices of leading digital assets such as Bitcoin (BTC-USD) and Ethereum (ETH-USD), as well as on the lenders, miners and exchanges that support digital coins and tokens. The price of Bitcoin is now trading below $17,000 and at the same level it was in October 2020. BTC is down 75% from an all-time high of $68,000 reached in November 2020.
The turmoil in the cryptocurrency market has gotten worse since leading exchange FTX filed for bankruptcy on Nov. 11, citing $8 billion in losses and more than one million creditors. Contagion from the FTX collapse has spread throughout the crypto sector globally. For cryptocurrency miners such as Greenidge, the downturn has been particularly severe.
Why It Matters
That GREE stock would be up more than 30% on news of a potential delisting is counterintuitive. Normally, stock prices fall on news of a possible delisting, which is an obvious negative for the company involved and its shareholders. That Greenidge Generation’s stock is rallying on news of a potential delisting suggests that investors are trying to pump up the share price and push it above $1.
Existing shareholders might also be buying more stock in an effort to get the share price above the $1 threshold required by the Nasdaq to protect their investment. Regardless of the reason, for the share price of a stock to rally on negative news such as a potential delisting is highly unusual and could be a sign that GREE shares are being treated like a meme stock by retail traders.
What’s Next for GREE Stock
The entire crypto industry is in turmoil right now, and GREE stock has all but collapsed prior to today. If Greenidge doesn’t succeed in getting its share price up above $1 and keep it there by June of next year, then the stock could disappear entirely. None of this is good news for investors and people should proceed carefully with this stock. Chances are the share price will fall again in short order.
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On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.