It seems everyone is getting in on cryptocurrencies.
Typically when a company rebrands, its stock waits until after the announcement to go for a run. That’s not what happened for penny stock Bioptix Inc. (NYSE: BIOP).
Bioptix, a maker of diagnostic machinery, almost doubled in value leading up to Wednesday’s announcement that the company would be rebranding itself to Riot Blockchanin and would be focusing on buying cryptocurrency and blockchain companies.
After the company announced the change in direction, its shares extended their rally as much as 17% to $9.50, the highest intraday level since January 2015.
For Bioptix, the move comes after a bad acquisition in 2016, according to CEO Michael Beeghley.
“When I got on the board, they had made an acquisition that we decided as a board did not make sense, so we closed that down and then decided to change our focus,” he said in an interview Tuesday. “We looked at the sector and said, ‘How can we participate in this, and how can our shareholders participate in this very exciting industry that’s like the beginning of the internet?’”
According to Bloomberg, the company’s first move under the Riot Blockchain is an investment in Coinsquare Ltd., a Canadian platform for exchanging digital tokens like bitcoin. Riot is paying a few million for a roughly 12% interest in Coinsquare, and wants to increase its stake to 20% in the future, according to CEO Beeghley.
After Coinsquare, Riot plans to buy companies focused on bitcoin mining, blockchain, and security software, which Beeghley plans to fund with a combination of cash and stock.