Shares of bitcoin-mining company Marathon Patent Group (NASDAQ:MARA) came crashing down on Wednesday after the company announced a $250 million stock offering. The immediate issue here is shareholder dilution, but the massive move could hold clues to the future of the company. As of 12:30 p.m. EST, Marathon stock was down 15%.So what
The price of bitcoin has risen dramatically over the last few months, and investors have played this trend by trading penny stocks of bitcoin miners like Marathon, Riot Blockchain, Bit Digital, and others. Even though Marathon stock is down today, it’s still up a massive 2,200% over the past six months. That’s how much this has been pumped thus far.
Recognizing the outsized gains, Marathon recently sold stock to raise $200 million. This brought its total outstanding share count up to almost 75 million. For perspective, just six months ago, the company had 32.1 million shares outstanding. In other words, as the price of its stock has risen, the company has basically cut shareholder value in half.
Weeks ago, when Marathon raised $200 million, it used the money to purchase new bitcoin mining equipment. Now the company will …Summary on Here’s Why Marathon Patent Group Stock Came Crashing Down Today provided by on