The first BNB reserve listed company was delisted, and the coin hoarding strategy is not a panacea
ORIGINAL | Odaily Planet Daily (@OdailyChina）
Author | Wenser (@wenser 2010）
Original title: BNB Reserve Listed Company WINT Delisted; “Coin Hoarding Strategy” Can't Cure All Diseases
No one expected that the “coin hoarding strategy” that has long been hailed by listed companies “failed” for the first time — according to US SEC documents, the US BNB treasury company Windtree Therapeutics (WINT) received a notice on August 19 that because its stock price stayed below $1 for too long, went through multiple reverse splits, and did not meet the usual grace period, its common stock would be delisted from the NASDAQ capital market and traded on the OTC market on August 21.
Affected by this message,WINT stock priceIt closed down 77.21% and is now at $0.11. The stock price of over $517 fell by more than 99.98% a year ago. Compared with its peak price of US$567,000/share at the beginning of its listing in 2020, it is even more unbearable.
Notably, the company announced the establishment of a BNB strategic reserve in July, and the stock price once rose to $1.28, but due to a long period of sluggish stock prices and the emergence of concept stocks such as “CEA, the BNB treasury company supported by Binance,” it was ultimately impossible to escape the fate of delisting.
This incident also placed one of the industry's major issues in the public eye: is the coin hoarding strategy effective for all listed companies? The Daily Planet Daily will analyze this in this article.
The first “BNB Strategy Listed Company” to be delisted appeared, sounding a wake-up call for the “double repair of currency stocks” industry
Public information display, Windtree Therapeutics Inc. (WINT) is a biotechnology company focused primarily on developing innovative treatments for respiratory diseases, particularly drugs for acute lung injury and cardiovascular diseases such as istaroxime and aerosolized KL 4 surfactant. The company was founded in 1992 and is headquartered in Pennsylvania, USA. According to itOfficial website informationThe final results of its istaroxime 2B clinical trial are out, but it is still far from its vision of “solving a market with significant unmet needs.”
As a small biopharmaceutical company, many of Windtree Therapeutics Inc.'s medical projects are in the clinical phase and are far from commercialization. According to the latest data, the company's net revenue for the most recent quarter was -$10.64 million, a significant increase in losses compared to -$404 million in the previous quarter.
On July 16, the companypronouncementsA securities purchase agreement worth $60 million has been signed with Build and Build Corp., and the subscription amount may increase to $200 million in the future. The relevant funds will be used to purchase BNB as a reserve for the company's treasury to achieve asset diversification and value creation. At the time, Windtree triggered FOMO in the market under the name of “the first NASDAQ listed company to provide direct investment exposure to BNB tokens,” and its stock price once soared to $1.86. On July 25, it once again stated that it had signed a new financing agreement of 520 million US dollars to buy BNB, but the market response was lackluster, and the stock price fell to around $1.
Today, a month later, what they have been waiting for is NASDAQOne-page delisting notice。
NASDAQ rules take effect, Windtree cannot escape delisting
According to Nasdaq Listing Rule 5550 (a) (2), if a listed company's stock price has continuously fallen below the minimum bid requirement of $1 for the past 30 consecutive trading days, then Nasdaq has the right to delist (that is, forcibly delist) the listed company's shares.
Notably, this is not the first time that NASDAQ has issued an “ultimatum” to the company — at the beginning of this year, NASDAQ granted the company a 180-day extension to resume compliance, but it still failed to meet the corresponding requirements as scheduled, so it was impossible to escape the delisting end.
However, breaking down the direct reason for Windtree's delisting this time is probably due to the loss of the “ecological rank” competition.
“BNB Treasury” orthodoxy dispute, Windtree becomes a victim of competition
One of the most intuitive reasons for Windtree's delisting is that a better “BNB Treasury” investment target has appeared on the market — that is, CEA Industries supported by Binance (later renamed BNB Network Company, stock code BNC).
On July 28, US stock listed companies CEA Industries and 10 X CapitalpronouncementsWith the support of YZi Labs, private placement of $500 million was carried out to establish a BNB treasury. It is reported that the two institutions will expand the PIPE distribution scale. More than 140 subscribers participated in the offering. In addition to YZi Labs, Pantera Capital, Arche Capital, GSR, Borderless, Arrington Capital, Blockchain.com, Hypersphere Capital Investment institutions such as Kenetic, etc.
Early August, CEA IndustriespronouncementsIt has completed $500 million in private equity financing and will change its name to “BNB Network Company”. The stock code will be changed to “BNC” on August 6, led by YZi Labs, and more than 140 institutions such as Pantera Capital and Blockchain.com will participate. Meanwhile, the company appointed David Namdar, the former co-founder of Galaxy Digital, as CEO, and Russell Read, former chief investment officer of the California Civil Service Pension Fund (CalPERS), as chief investment officer.
At this point, the “BNB Treasury” orthodoxy dispute came to an end in stages. BNC became the winner, while WINT became the “outcast.”
It is worth noting that Nano Labs, another US stock listed company on the market that focuses on the “BNB treasury company” concept, also participated in CEA Industries' previous financing.Acquired 49,5050 Class A common shares at a cost of nearly $5 millionIt also includes the same number of 495,050 warrants at an exercise price of $15.15 per share. If fully exercised, Nano Labs would hold up to 990,100 shares of the company. As a result, Nano Labs, which has a BNB holding up to 128,000, has instead become one of the investors behind BNC, thus remaining on the table.
Before writing,BNC closing priceAt $21.02, the 24-hour increase was as high as 8.8%, and the market capitalization was tentatively reported at US$895 million;Nano Labs (NA) closing priceAt $4.5, the 24-hour increase was 4.9%, and the market capitalization was tentatively reported at $104 million. As a comparison,WINT Market CapitalizationIt has dropped to around $3.15 million.
They all say that shopping malls are like battlefields. This is particularly direct and cruel in the stock market.
Industry warning: A coin storage strategy also requires prerequisites to be effective; it is not a “perpetual stock price motivator”
Judging from the Windtree delisting, it is obvious that for most listed companies, the coin hoarding strategy is not a “universal key” to driving up stock prices. The reason why US and Nikkei listed companies such as Strategy and Metaplanet can achieve the “double take-off” effect is a prerequisite for taking effect. In my opinion, it is necessary to meet the following 3 conditions:
First, BTC is the first choice for coin hoarders. As the “only true god” of the cryptocurrency industry, the value of BTC is relatively stable and more easily accepted by the market, investors, etc., and the coin hoarding strategy is relatively more intuitive and sustainable in boosting stock prices. After all, the current price of a single BTC, which is around 110,000, still falls short of target expectations for many traditional institutions and crypto institutions. Over the next 5-10 years and beyond, BTC is still expected to rise by 50% or more. When it comes to cryptocurrencies, it's all about a “market dream rate,” and BTC's effectiveness in fighting inflation, diversifying risk, and boosting expectations is certainly unique.
The second is the uniqueness of ecological niche competition. In the myriad capital markets, competition for ecological positions is unquestionably cruel. After all, for most industries and investment tracks, the phenomenon of people “only knowing first and not knowing second” is too common. Especially in terms of whether “orthodox institutions” support it or not, it is a completely different concept for market users. Although in reality, investment targets are not much different, the impact on market sentiment and long-term judgment exists objectively. Therefore, if a coin storage object other than BTC is selected, then it is necessary to consider the public awareness and acceptance of the corresponding token and the direct influence of the project party.
The third is real business support. Unlike various listed companies that have recently been listed behind the scenes, including listed companies such as Metaplanet and Cangu Group, have real business support, and are therefore more resistant to other risk factors such as currency price fluctuations and technical safety, and are less regulated by the stock market and even traditional financial market regulators, without too much consideration of risks such as delisting. Simply put, listed companies that can make their own blood are more emboldened to buy coins than listed companies that rely on financing to buy coins.
Windtree's delisting is only a microcosm of the industry's development at this stage, and the emergence of “listed ETH reserve companies” such as Bitmine and Sharplink may be the real disruptor of the “over-leveraged game” described by Ethereum founder Vitalik. At that time, we will wait and see if the “coin storage strategy” fails for listed companies.
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