Shares in American Bitcoin (ABTC) sank to an all-time low on Wednesday ahead of the company’s reverse stock split, which aims to buoy shares and keep it listed on the Nasdaq.
American Bitcoin announced a 1-for-15 reverse stock split. The split will take effect after the market closes Thursday and begin trading on a split-adjusted basis when the market opens Monday. The stock would continue to trade under the ticker ABTC. Under the plan, every 15 shares of the company’s Class A and B common stock will be reclassified as one share. The company expects its common stock to be reduced from more than 1 billion outstanding shares to about 73 million. American Bitcoin is the only public crypto company tied to the Trump family’s interests in the sector, and a reverse stock split is typically seen as negative, as it can indicate distress and an effort to artificially boost the share price. The split aims to prop up shares to maintain compliance with Nasdaq’s minimum bid requirements, which could lead to delisting if the closing price stays below $1 for 30 consecutive trading days. Shareholders had approved the reverse stock split on June 22.
American Bitcoin’s stock has also faced broader market pressure in crypto, with other companies applying similar steps. For example, Nakamoto completed a 1-for-40 reverse stock split in May to stay listed after reaching a low of 16 cents in April.
The reverse stock split is intended to help the company meet Nasdaq’s minimum bid requirements and avoid delisting, a move that market participants often view negatively when a firm is perceived to be in distress.
The situation reflects the broader downturn in the crypto market, and reverse stock splits have been used by other companies to prop up share price. The percentage declines and the loss in Q1 underscore ongoing challenges for American Bitcoin as it navigates listing requirements and market conditions.
