Bitcoin Shop Inc (OTCMKTS:BTCS) Rises on Record-Breaking Volume
Bitcoin Shop Inc (OTCMKTS:BTCS) disappointed quite a lot of investors when it plummeted from over $5 per share to less than $0.10 in just over three and a half months.
Many people got a bit carried away with the hype around the bitcoin business and the fact that BTCS received plenty of publicity during the first few months. Unfortunately, some of them are probably looking at some pretty painful losses at the moment. The question on their mind is: “Can BTCS get a second chance?“.
Apparently, this is happening right now. Yesterday, the ticker logged a dollar volume of around $2 million and gained a respectable 18%. It’s now sitting at just under $0.21 which is a whopping 128% above the 52-week low registered last week.
The surge in the right direction seems to be in unison with the performance of the virtual currency itself. Bitcoins have appreciated over the last couple of days and this seems to be because of the fact that more and more serious companies like DISH Network Corp (NASDAQ:DISH) are starting to accept the revolutionary payment method.
Being one of the first ever enterprises to deal in the booming sector means BTCS‘ stock performance will always be tied to that of bitcoins. Unfortunately, this might not necessarily be a good thing. At the moment, the currency’s performance is not exactly consistent and we won’t be too surprised if we see some more wild swings from BTCS in the future.
That is one thing you should definitely bear in mind before making your final investment decision and while you’re contemplating the options, you might also want to read through the latest financial statement. It covers the first quarter of 2014 and it contains the following figures:
- cash: $1.4 million
- current assets: $1.5 million
- current liabilities: $178 thousand
- quarterly revenues: $11 thousand
- quarterly net loss: $1.4 million
The balance sheet certainly doesn’t look as bad as the ones presented by other penny stock companies, but even so, investors were expecting much more, especially in terms of revenues.
And while we’re on the subject of financial reports, we would like to draw your attention to the 2013 10-K. If you open it and have a really good look through it, you’ll see that back in 2010, the company issued a $400 thousand convertible promissory note. In January, when BTCS was in the process of taking up the new business plan, they decided to retire the note and as a result, the creditors received 400,000 Series B Preferred shares.
Each and every one of the preferred shares can be turned into 100 common ones which means that if the creditors decide to convert their stock and then let it loose on the open market, they could be in for quite a profit. Apparently, the conversion part of the plan is being taken care of as we speak.
During Q1, 134,194 preferred shares were turned into 13,149,400 common ones. As you might have calculated already, back on March 31, there were around 26 million common shares waiting to be issued as a conversion of preferred stock. We reckon 
that you should definitely consider them and the risk that they bring before putting any money on the line.
BTCS wasn’t the only actively traded penny stock yesterday. Growblox Sciences Inc (OTCMKTS:GBLX) logged a dollar volume of around $1.5 million and wiped out a fifth of its value. Terra Tech Corp (OTCMKTS:TRTC), on the other hand, managed to shift more than $5 million worth of shares and finished the day with 14% in gains.
