tl;dr
Windtree Therapeutics, a Pennsylvania-based drug developer, will be delisted from Nasdaq after failing to maintain the minimum bid price of $1 per share. Trading will cease on August 21, with shares having dropped 77% to $0.11. Since its Nasdaq listing in May 2020, Windtree has faced multiple bid-pr...
Windtree Therapeutics, a Pennsylvania-based drug developer, is set to be delisted from Nasdaq after failing to maintain the required minimum bid price of $1 per share. This announcement came in an SEC filing revealing that Nasdaq trading for Windtree's stock would cease at the open on Thursday, August 21. The company's shares have plummeted 77% on the day to just $0.11.
Since listing on Nasdaq in May 2020, Windtree has struggled to meet the exchange's listing standards, facing multiple bid-price violations since June 2022. The most recent deficiency warning was issued in December 2023. In a surprising pivot last month, Windtree committed to investing up to $700 million in Binance's BNB token, trying to capitalize on the cryptocurrency's new all-time highs. Although this move temporarily brought the company into compliance earlier this year, a subsequent crypto market downturn saw the stock falter again.
Windtree's situation mirrors a broader trend where publicly-listed companies with crypto treasury strategies, such as KindlyMD, SharpLink, Coinbase, and Strategy, have experienced share price declines amid crypto market instability. As a result, Windtree will move to the over-the-counter (OTC) market under the same ticker, WINT. Unlike Nasdaq, OTC markets have more relaxed listing requirements but offer less liquidity and market visibility.
Ryan Yoon, senior analyst at Tiger Research, explains the dilemma faced by digital asset treasury (DAT) firms like Windtree. While these companies sometimes manage to raise initial funds despite skepticism, subsequent capital raises become difficult as market confidence wanes. DAT firms rely heavily on premium-based funding strategies, but struggling entities cannot sustain net asset value (NAV) premiums over time.
NAV, representing a company's assets minus liabilities per share, indicates whether stock prices reflect underlying asset value. Yoon describes a "reverse flywheel" effect during downturns where asset declines trigger forced liquidations, which then accelerate further declines. He highlights Michael Saylor’s Strategy as a prominent example that created a successful narrative within crypto markets. However, many companies attempting to emulate this model lack the operational substance behind the narrative, making them vulnerable during market stress.