A company investing in the future of bitcoin tech is splitting its stock in 10 after it soars 1,600%
Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York Thomson Reuters
- The Crypto Company, a cryptocurrency firm building out the capital markets for bitcoin, is splitting its stock after an eye-popping month.
- The company's stock, which trades in the OTC market, soared more than 1,600% to $312 a share since December 1.
Cryptomania is sweeping Wall Street and it is sending the stock of crypto-linked companies to incredible new heights.
The Crypto Company has not been immune. The firm, which is building out the capital markets infrastructure for the nascent digital coin market, announced Wednesday evening it plans to split its stock into ten after soaring more than 1,600% since December 1.
The company started trading in the over-the-counter markets in June at around $3 a share. It soared to an all-time high of $642 a share on December 12, according to Bloomberg data. It was trading at $312 just before market close on Wednesday.
“We hope that an increased float will contribute to a more orderly and safer market for our stock and corresponding investors," the company's CEO Mike Poutre said in a statement. "All investors should be cautious when they see volatile markets such as this."
Companies typically split their stock in order to deflate the price to levels on par with peers in the market. Apple notably split its stock in 2014. Investors got seven shares for every stock.
The stock split comes at a pivotal time for the cryptocurrency market, which is under pressure to meet exploding demand and volumes as coins like bitcoin soar to eye-popping heights. Total trading volumes across all of the cryptocurrency exchanges, according to CoinMarketCap, have nearly quadrupled since early November to near $40 billion a day. To put that in perspective, the New York Stock Exchange sees $50 billion worth of shares trade in a day.
"When bitcoin crossed $10,000 a few weeks ago all the exchanges went down because of volumes," Poutre said. "Our strategy is to invest in the capital markets infrastructure for crypto."
For instance, the company is looking into projects to improve exchange latency, the speed at which exchanges communicate data to traders. On Wall Street exchanges and traders communicate in fractions of a second. In crypto, it can take as much as three seconds. That's the equivalent to a lifetime, according to Poutre.
"If Wall Street were to get in here they would have a field day fixing this stuff," he said.
Poutre said the company's rise is tied to the number of problems in the space begging to be fixed. The company, which was founded in March of 2017, expects to be profitable in 2018.
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