Trump Sons’ Bitcoin Mining Firm ABTC Plunges Amid Lock-Up Expiry
American Bitcoin Corp. (ABTC), the Bitcoin mining enterprise co-founded by Donald Trump Jr. and Eric Trump, faced a dramatic stock market decline on Tuesday. The sharp sell-off, which saw shares plummet by nearly 50% at market open, was triggered by the expiration of the lock-up period for its private placement shares.
According to Google Finance data, ABTC’s stock price witnessed an initial freefall of almost 50% within the first hour of trading. It dropped from the previous day’s closing price of $3.58 to an intra-day low of $1.80, eventually recovering slightly to close at $2.19, marking a substantial single-day loss of 38.83%.
Eric Trump Addresses Market Volatility
In response to the market’s reaction, Eric Trump took to social media to explain the situation. He stated, “Today, our pre-merger private placement shares unlocked – this is the first time early investors could realize profits, so stock price volatility is inevitable.” He further reassured stakeholders by emphasizing that he had not sold any of his own holdings, asserting that the company’s underlying fundamentals are “almost unparalleled.”
ABTC’s Journey to Nasdaq and Strong Q3 Performance
American Bitcoin Corp. made its Nasdaq debut in September this year under the ticker symbol “ABTC,” following its merger with another prominent mining entity, Gryphon Digital Mining (GRYP).
Just last month, ABTC unveiled an impressive third-quarter financial report, showcasing remarkable growth. The company’s revenue surged from $11.6 million in the same period last year to a robust $64.2 million. Furthermore, ABTC successfully turned around a net loss of $0.6 million from the previous year, achieving a net profit of $3.5 million. CEO Michael Ho highlighted the company’s exceptional performance, noting a doubling of both mining capacity and revenue within a single quarter, alongside a 7 percentage point increase in gross margin compared to the preceding quarter. As of November 13, American Bitcoin’s asset reserves boasted approximately 4,090 Bitcoins.
Despite Growth, Share Price Struggles Amid Broader Market Downturn
Despite these strong operational and financial achievements, American Bitcoin’s stock price has faced significant headwinds. After reaching a peak of $9.31 in September, shares have steadily declined, accumulating a cumulative loss of 76.5% to date.
ABTC’s struggles are not isolated; they mirror a broader downturn impacting cryptocurrency-related stocks across the market. Over the past month, major players have also seen significant drops: Coinbase’s stock price fell by 20%, USDC issuer Circle plummeted by 39%, and Gemini experienced a nearly 47% decline. This widespread weakness underscores the challenging environment for digital asset companies, largely attributed to a softening cryptocurrency market.
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