Nakamoto Inc., a Bitcoin holding company, announced on Wednesday that its board of directors has approved a 1-for-40 reverse stock split of its common shares. The move aims to elevate the share price above the Nasdaq's minimum bid requirement of $1 per share to maintain its listing status. The reverse split will take effect on May 22, 2026.
Split Details: Outstanding Shares to Reduce from 696 Million to 17.4 Million According to filings with the U.S. Securities and Exchange Commission, the reverse stock split was previously approved at a special shareholders' meeting held on May 8, 2026. Shareholders authorized the board to determine the final ratio within a range of 1-for-20 to 1-for-50, and the board subsequently set the ratio at 1-for-40.
The company stated that the reverse split will become effective at 12:01 a.m. Eastern Time on May 22, 2026. At that time, every 40 shares of Nakamoto's existing common stock will be automatically combined into one new share. Consequently, the total number of outstanding shares will decrease from approximately 696.1 million to about 17.4 million. The total authorized shares and the par value per share of the common stock will remain unchanged.
The company's transfer agent, VStock Transfer, will manage the implementation of the split. For shareholders holding shares through brokerage accounts, their holdings will be automatically adjusted according to their brokers' procedures, typically requiring no action. Fractional shares will be paid in cash to eligible shareholders.
Purpose: To Comply with Nasdaq's $1 Minimum Bid Price Rule The primary objective of this reverse split is to meet the continued listing requirements of the Nasdaq Global Market. Under Nasdaq Listing Rule 5450(a)(1), listed companies must maintain a minimum bid price of $1 per share. However, Nakamoto's stock price has been under prolonged pressure, trading around $0.22 prior to the announcement—approximately 79% below the $1 threshold. The company had previously received a compliance notice from Nasdaq, requiring it to achieve a closing price above $1 for ten consecutive trading days by June 8, 2026, or face potential delisting.
Company Background and Market Perspective Nakamoto is a company with a core strategy centered on Bitcoin asset allocation, operating in media and information services, asset management, and advisory services. The company holds approximately 5,398 Bitcoins, valued at about $483 million at current prices. However, its stock trades at a discount of roughly 64% relative to the net asset value of its Bitcoin holdings.
A reverse stock split technically increases the nominal share price without altering the company's fundamentals or the proportional economic interest of shareholders. The market often views such actions as a remedial step following prolonged stock price pressure and weakened investor confidence. Nevertheless, the move helps the company preserve its Nasdaq listing, thereby maintaining public market liquidity and buying time for future strategic initiatives.
As of the latest update, Nakamoto's stock price experienced some volatility following the announcement. The company cautioned investors that the reverse split does not change the fundamentals of its Bitcoin-focused business, and whether it can regain market trust through subsequent operations remains a long-term challenge.
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