Riot Blockchain Inc. (NASDAQ:BIOP)
Shares of Riot Blockchain Inc. (NASDAQ:BIOP) gained 18.1% after the maker of diagnostic machinery announced it was rebranding itself to focus on cryptocurrency and blockchain businesses. The company has since announced a strategic investment in Coinsquare Ltd, a leading digital currency exchange company.
Riot Blockchain Bitcoin Push
The rebranding push has resulted in the stock more than doubling in value since the start of the month. BIOP is up by more than 100% for the year as investors apparently remain confident about its prospects in the cryptocurrency business.
However, it is not the first company to be rewarded heavily by investors after expanding into the cryptocurrency space. Overstock.com and MGT Capital Investments also experienced astronomical increases in value after expanding their operations into the bitcoin space.
Riot Blockchain Inc. (NASDAQ:BIOP) has enjoyed a fair share amount of drama. Last year Venaxis acquired Bioptix Diagnostics and then renamed it Bioptix Inc. The acquisition quickly turned nasty after major shareholders accused the company’s executives of an “inside” job to benefit themselves.
In January, the company also found itself in trouble after three board members tendered their resignation. The company afterward announced job cuts as it sought to stay afloat by pursuing strategic alternatives.
Fast forward, Riot Blockchain is hoping to reinvent itself by investing in blockchain technologies and companies.
“With new applications being developed for blockchain every day, this is a rapidly growing and evolving market. We are excited to have partnered with and led an investment in Coinsquare, a company we believe is well positioned to capitalize on the opportunity in this sector,” said CEO Michael Beeghley.
Riot Blockchain Acquisition Play
Riot Blockchain Inc. (NASDAQ:BIOP) has paid a few million dollars for a 12% stake in Coinsquare. The company has also acquired warrants which it can use to increase its stake to 20%.
The Chief Executive Officer has also announced plans to buy companies focused on bitcoin mining, blockchain, and associated software. The deals are to be financed by a combination of cash and stock. In order to raise cash, the company is selling patents and intellectual property to a private company. The company expects as much as $2.5 million from the transactions.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.