Bitcoin treasury company Nakamoto is moving ahead with a shareholder-approved 1-for-40 reverse stock split on Friday in an effort to avoid delisting from the Nasdaq Stock Exchange.

The company received a notice from the Nasdaq on Dec. 10, warning that its stock price had fallen below the $1 minimum for 30 consecutive business days, according to an SEC filing. Nakamoto has until June 8 to address the issue and keep its stock above $1 for at least 10 days. 

A reverse stock split reduces the number of shares outstanding. In a 1-for-40 split, every 40 shares are combined into one. After completion, Nakamoto’s total common shares will drop from 696.1 million to 17.4 million, the company said Wednesday.

“The reverse stock split is intended to increase the per-share trading price of the company’s common stock to regain compliance with the $1 minimum bid price requirement for continued listing on the Nasdaq Global Market,” it added.

Crypto treasury companies have been in a downturn since 2025, with many companies’ stock prices falling below the value of the crypto on their balance sheets, Standard Chartered reported last September.

Wojciech Kaszycki, chief strategy officer of crypto infrastructure and treasury company BTCS, told Cointelegraph in March that treasury companies will likely start merging and consolidating this year to stay afloat.

Nakamoto’s share price, NAKA, closed 16 cents on Wednesday, down 7.5%, according to Google Finance. It is down more than 99% from May last year, when it traded above $25 shortly after the company unveiled its Bitcoin treasury strategy and merger with health care provider KindlyMD.

Source: Nakamoto

Nakamoto posts $238.8 million net loss in Q1

Nakamoto shareholders approved a reverse split ratio range of 1-for-20 to 1-for-50 at a special meeting on May 8. The shares are expected to undergo the change on Friday, according to Nakamoto.

The company announced its first-quarter financial results on May 14, recording a 500% quarter-over-quarter increase in revenue but a $238.8 million net loss, with more than $102 million attributed to a mark-to-market loss on its 5,058 Bitcoin (BTC) treasury after the cryptocurrency fell 23% during the quarter.

Related: Tether buys SoftBank’s stake in Bitcoin company Twenty One Capital

Most Bitcoin treasury companies, aside from Strategy and Metaplanet, have slowed Bitcoin buying over the past 12 months, while others have started tapping their Bitcoin treasuries to pay off debt. The Genius Group liquidated its entire treasury holdings of 84 Bitcoin in February to help pay debts.

Nakamoto didn’t buy any Bitcoin during the quarter but sold 284 Bitcoin on March 31 to cover operational expenses.

Nakamoto’s current holdings make it the 20th largest Bitcoin treasury company according to BitcoinTreasuries.Net, just behind ProCap Financial, which holds 5,457 Bitcoin. The leading treasury is Michael Saylor’s firm Strategy, with more than 843,000 Bitcoin on its balance sheet.

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Bitcoin’s rejection near its 200-day moving average has renewed pressure, but K33 says the market still differs from past bear-market rallies.

Bitcoin has struggled since revisiting its 200-day moving average near $82,000 earlier in May. The move revived concern that the latest recovery could fail like the rebounds seen in 2014, 2018 and 2022, when rallies into the same indicator came before new cycle lows.

K33 Head of Research Vetle Lunde said the current setup does not match those periods. Bitcoin took 189 days between its November break below the 200-day moving average and the May retest, far longer than the 96, 132 and 85 days seen in earlier cycles. Lunde wrote, 

“Past rallies recovered quickly, rebuilding risk appetite and leverage and setting up the unwind that fueled the next leg lower. The current slow grind has not.”

ETF outflows show defensive positioning

K33 said the market still lacks the heavy leverage build-up that often appears before a deeper sell-off. The firm also pointed to 13F filings, which showed institutional investors cut Bitcoin exposure by 26,733 BTC in the first quarter, while retail investors added 19,395 BTC.

Separate market updates show the same defensive tone. U.S. spot Bitcoin ETFs recorded more than $1 billion in cumulative weekly outflows as Bitcoin fell below $77,000, while liquidations across crypto topped $661 million. A day later, the products posted $648.6 million in net outflows, the largest single-day withdrawal since Jan. 29, with BlackRock’s IBIT accounting for $448.3 million.

Bitcoin traders remain cautious near cost basis

K33 also said heavy ETF withdrawals have become more common when Bitcoin trades close to the average cost basis for ETF buyers. Lunde said investors often try to avoid losses or limit losses after deep drawdowns when price returns to that area.

The firm kept its central view unchanged despite the recent weakness. Lunde said, “We maintain our view that the less aggressive bull market of 2025 sets the stage for a more moderate bear market in 2026,” adding that February’s $60,000 low remains K33’s base case for the cycle’s maximum drawdown.

Meanwhile, Bitcoin traded near $77,400 on May 20, according to crypto.news, down about 4.2% over seven days.

The asset also remains far below its October 2025 record high of about $126,080, showing that the recovery has not fully repaired market confidence.

Coinbase and Flipcash have launched USDF, a Solana-based custom stablecoin fully backed by USDC, as Coinbase expands its branded stablecoin infrastructure business.

Coinbase said on May 20 that USDF was created through its Custom Stablecoin platform. The token is issued on Solana and fully backed by USDC. Coinbase described the launch as part of its effort to make stablecoin issuance easier for businesses.

Flipcash will use USDF inside its app, where users can create fixed-supply digital currencies. Each currency on the platform will be priced and settled in USDF, giving the app a single dollar asset for buying, selling, and using those currencies.

Coinbase targets branded stablecoin demand

Coinbase’s Custom Stablecoins product lets companies launch branded digital dollars without building the full blockchain, reserve, and settlement system themselves. The company says the product allows partners to issue stablecoins backed 1:1 by USDC and other dollar stablecoins.

The product page says Coinbase manages issuance, reserves, smart contracts, and onchain operations. It also says custom stablecoins are redeemable 1:1 with USDC, while partners can use the tokens for payments, treasury, rewards, and DeFi use cases.

“We launched USDF with Coinbase because they delivered everything we needed,” Flipcash founder and CEO Ted Livingston said in a quote published on Coinbase’s Custom Stablecoins page. He said Coinbase helped support the consumer experience Flipcash wanted to build.

Coinbase expands USDC use across payments and settlement

Related crypto.news coverage in December reported that Coinbase’s Custom Stablecoins service allows businesses to issue branded, USDC-backed tokens through Coinbase Business. That report said the service covers issuance, custody, and compliance support for participating companies.

Coinbase has also been growing USDC use in payments and settlement. Separate crypto.news coverage said Nium integrated Coinbase infrastructure to support USDC-based cross-border payments across more than 190 countries. That setup allows businesses to fund payouts in USDC and settle in stablecoins or local currencies.

Stablecoin infrastructure competition grows

USDF comes as more companies build stablecoin payment and settlement products. Coinbase is not only offering a stablecoin asset. It is offering the infrastructure that lets other companies place their own brand on a dollar-backed token.

The model places Coinbase in a growing market for white-label stablecoin tools. Businesses can use these systems to issue branded digital dollars while relying on larger providers for custody, reserves, access to fiat rails, and onchain operations.

For Flipcash, USDF gives the app a dollar unit for its user-created currencies. For Coinbase, the launch adds another live example of its stablecoin infrastructure strategy as companies test branded digital dollars for consumer apps, payments, and settlement.

US-based exchange-traded funds tied to HYPE recorded a 50% trading volume jump on Wednesday, in a rare move for newly debuted ETFs, according to analysts. 

Two Hyperliquid (HYPE) ETFs from issuers Bitwise and 21Shares have recorded nearly $41 million in total value traded since their launches earlier this month, with trading volumes increasing since their debuts, according to SoSoValue.

Bloomberg ETF analyst Eric Balchunas said in an X post Wednesday that such trading increases for ETFs are “very rare,” and many normally record a “big splash [on] day one then drop off OR oblivion for months until [people] notice it. Rare to build in first week like this.”

Balchunas pinned the ETFs’ growth on a “perfectly timed launch as EVERYTHING (stocks, bonds, gold, btc [Bitcoin], cryptos) is down lately except the HYPE.”

Source: Eric Balchunas

The Hyperliquid token has gained 120% so far this year and is up 18.5% in the past day to $56, according to CoinGecko. Traders have flocked to the token and the platform, with some analysts viewing it as the next trendy crypto play because it has captured a large portion of the crypto perpetual futures market.

Over the past year, the S&P 500 has gained 8.6%, while the tech-heavy Nasdaq 100 has gained 16%, while Bitcoin has fallen 11%. 

It comes a day after Bitwise, one of two issuers of a US-based HYPE ETF, said traders had mispriced HYPE, arguing the platform is more than just a crypto exchange, but a “super-app” encompassing multiple asset classes.

Related: Hyperliquid eyes 55% price rise after Silicon Valley investor’s ‘massive HYPE buy’

21Shares was the first to launch a HYPE fund in the US, launching its 21Shares Hyperliquid ETF (THYP) on May 12 and drawing $1.2 million in net inflows, far below other altcoin ETF launches such as those for Solana staking. 

The Bitwise Hyperliquid ETF (BHYP) debuted later that week on May 14 to $750,000 in net inflows, 

The two ETFs recorded their highest day of net inflows Wednesday, with a combined $25.5 million in net inflows. The 21Shares ETF recorded $16.6 million, while Bitwise’s ETF recorded $8.8 million. 

Crypto asset manager Grayscale also filed for a Hyperliquid ETF in March, with the planned fund currently being processed by US regulators.

The X account Lookonchain said on Wednesday that two wallets linked to Grayscale had purchased $25 million worth of HYPE over the past week and staked it, but it is not known if the move is tied to the company’s planned ETF.

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The US securities regulator is delaying the launch of a recent wave of “novel ETFs,” including those that allow investors to bet on the outcome of events, to consider the implications of introducing the new products. 

In a statement on Wednesday, SEC Chair Paul Atkins said that “novel products raise novel questions” and instructed his staff to seek public feedback on how the regulator should respond to these applications. 

Bitwise filed in February for a series of prediction market ETFs under the PredictionShares brand to track US election results, while Roundhill Investments and GraniteShares also filed for prediction market ETFs that month. 

Prediction markets have become one of crypto’s hottest use cases over the past 18 months and now consistently record more than $15 billion in monthly trading volume across markets spanning from sports and elections to financial results and cultural events. 

A prediction market ETF would give investors a way to gain exposure to these binary event contracts directly through a traditional brokerage account. The journey mimics the institutionalization of cryptocurrencies such as Bitcoin (BTC) and Ether (ETH), which have seen billions in inflows into their respective crypto ETFs. 

Bloomberg ETF analyst Eric Balchunas said the SEC is “clearly wrestling” with how to handle the new asset class, similar to how it navigated issues with spot crypto ETFs before approving them in January 2024. 

The SEC wants to feel comfortable with prediction market ETFs before they “open the barn door,” Balchunas said.

Source: Eric Balchunas

The decision to delay the applications also comes as prediction market platforms like Kalshi continue to face court challenges in several US state courts. 

SEC has been more open to innovative ideas

Atkins said ETFs have been a “major driver” of innovation in the securities markets, boosting capital and broadening investor choice while noting that ETF assets have tripled since 2019.

Related: Trump-backed Truth Social pulls bids for crypto ETFs 

The SEC has shown more flexibility in approving innovative products in recent years, particularly after introducing the generic listing standard model in September and replacing the process of reviewing applications on a case-by-case basis.

Meanwhile, the SEC is reportedly considering creating an “innovation exemption” to allow tokenized stock trading, which would put versions of Apple (AAPL), Nvidia (NVDA), Tesla (TSLA) and other stocks on crypto rails.

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