The Houston-based cryptocurrency mining company NASDAQ: DGHI (Digihost ), which violated Nasdaq’s listing requirements by having its stock value stay below $1 for a protracted period of time, was issued a deficiency warning on the 10th of October.
The Nasdaq’s Delisting Rule
One of Nasdaq’s regulations mentioned that whenever a firm’s stock stays below the one dollar mark for 30 days consecutively, it is at risk of being delisted and will be issued a deficiency notice.
Nasdaq has issued the stock a 6-month (180 days) recovery period, lasting till the 10th of April, 2023. Before the time elapses, the stock must trade above the one-dollar mark for at least ten straight days.
In a statement with the SEC on its noncompliance with Nasdaq, Digihost stated that if a firm does not adhere to Nasdaq’s delisting rule by the 10th of April, 2023, the stock may be entitled to an additional 180 calendar day compliance term.
According to exchanges, Digihost fell below one dollar on the 23rd of August, 2022. The falls is its first since being listed on crypto trading platforms on the 15th of October, 2022.
The stock traded around $4.6 until early 2022. In January, the stock registered an 84 percent drastic decline in price, causing its value to fall to $0.71.
Reason DGHI Failed To Comply With Nasdaq’s Delisting Regulations
In the SEC release, Digihost reassured traders that it would meet the needs of the Nasdaq regulatory issue and made it clear that the current notification had no impact on the firm’s commercial activities.
Digihost’s inability to satisfy Nasdaq’s registration regulatory requirements is most likely due to the prolonged BTC bearish market, which severely affects the mining sector. According to Exchanges, BTC (Bitcoin), the most popular crypto, has plummeted 71.98% from its milestone peak of $68,789.63 set in late 2021.
As per reports, it seems DGHI is not the only defaulter of the Nasdaq’s compliance policy. NASDAQ: MIGI (Mawson Infrastructure Group), an infrastructure provider based in Australia, has also traded below one dollar for a protracted time, failing to adhere to Nasdaq’s compliance rules. The stock currently hovers around $0.4. The stock may also face Nasdaq delisting risk, although there is no official statement yet.