On May 21, the publicly listed Bitcoin treasury company Nakamoto (NAKA) announced that it will implement a 1-for-40 reverse stock split. The number of common shares outstanding will decrease from 696.1 million shares to 17.4 million shares, with the effective date confirmed as May 22. The purpose of this split is to push the NAKA share price to at least $1, so that it can once again meet the Nasdaq minimum bid price continued listing requirement.
Confirmation process for the reverse stock split: shareholder approval, ratio selection, and effective date
Nakamoto held a special shareholders meeting on May 8, 2026, where shareholders approved proposals in the range of 1-for-20 to 1-for-50. The board of directors subsequently selected 1-for-40 as the execution ratio. After the split is completed, the number of common shares outstanding will fall from 696.1 million shares to 17.4 million shares. The company announcement confirmed that the effective date is May 22, 2026 (Friday). After the close on May 21, the NAKA share price rose by about 2.6%, but it remains far below the $1 Nasdaq compliance threshold.
NAKA financial snapshot: Q1 loss and Bitcoin sales for two consecutive quarters
Nakamoto reported a Q1 loss of about $239 million last week, mainly due to mark-to-market accounting impacts from a decline in the price of Bitcoin. In terms of asset sales, the company first sold about $20 million worth of Bitcoin in Q4 2025; it then sold about $22 million worth of Bitcoin again in Q1 2026. This marks two consecutive quarters of selling core assets since the company adopted its Bitcoin treasury strategy. As of the time of reporting, the company holds more than 5,000 BTC, with a value of over $388 million based on current market prices.
Bitcoin market backdrop: BTC at about $77,927, still 38% below its all-time high
At the time of reporting, Bitcoin was trading at about $77,927, up 1.6% over the past 24 hours and up more than 2% over the past month. Bitcoin remains more than 38% below its all-time high of $126,080 set in October 2025.
FAQ
What are the main reasons behind NAKA’s 99.5% stock drop?
NAKA’s share price has continued to fall, mainly reflecting an overall adjustment in the Bitcoin market. The company recorded a loss of about $239 million in Q1, primarily due to mark-to-market losses on its Bitcoin holdings from the decline in Bitcoin’s price, not operating losses. Selling its Bitcoin holdings for two consecutive quarters has also drawn market attention to its financial situation.
Has the 1-for-40 reverse stock split been formally approved by shareholders?
Yes. Shareholders approved the proposal range of 1-for-20 to 1-for-50 at the special shareholders meeting on May 8, 2026. Nakamoto’s board selected the 1-for-40 ratio, and the effective date has been confirmed as May 22, 2026 (Friday).
What exactly is Nasdaq’s minimum bid price compliance standard?
Nasdaq requires that the listed company’s stock maintain a minimum bid price of more than $1 to meet the continued listing standard. NAKA’s current share price is about $0.158, which is below this threshold. After the reverse split, the theoretical share price would be about $6.32, which could restore compliance. However, the reverse split itself does not change the company’s fundamentals or total marketcap.
