European Bitcoin ( BTC ) mining firm Northern Data has seen its stock fall 40% in days amid claims that it committed fraud. Data from Bloomberg showed the company’s NB2 stock trading at under €47 ($53.70) at the end of July 17, down from €79 ($90.30) on Monday. Northern Data, the product of a 2019 merger between U. S. company Whinstone and Northern Bitcoin, claimed to offer High Performance Computing/Artificial Intelligence (HPC/AI) solutions. While touting the scale of its computing capacity to investors and analysts, including well-known German bank researchers, one critic in particular argued that in fact, the company was mostly involved in Bitcoin mining hosting. For well-known investigative Twitter user BTCKING555 , suspicions arose when Northern Data failed to respond to basic questions about its business. Thereafter, a Medium post delivered a longer exposé, after which Northern Data hit mainstream media and its share price tumbled.“It’s a very unpleasant point in time,” Maximilian Martin, head of finance at Northern Data, commented to the Financial Times .“It gives the anonymous trolls a power of influence. I’m not concerned because I know we’re no criminals — that’s the biggest point of differentiation. We’re as transparent as it gets.”Northern Data share price 1-month chart. Source: BloombergThe Medium post disagrees. Taking issue with everything from revenue to pricing, it also casts doubt on the legitimacy of those who invested in the company itself, among them well-known crypto companies SBI Holdings and The Block.“As such we make a conclusion:1) Northern Data clients are paying lower, industry competitive, rates and the company is cooking the books;2) The company has found the dumbest customers in the crypto industry and milking the most it can for its whopping 40% gross margin.”The debacle is grimly pertinent, coming within weeks of another German scandal involving financial firm Wirecard . After $2 billion went unaccounted for, the company folded, with the knock-on effects impacting consumers worldwide. Any funds tied to Wirecard, such as those on prepaid debit cards, were suddenly frozen, leaving users without their money. As Cointelegraph reported , Bitcoin debit cards were also affected. Before its own difficulties, Northern Data was another example of cryptocurrency business equity vastly outperforming cryptoassets themselves — often thanks to roadmaps that include plans such as conducting an initial public offering, or an IPO. Other firms such as Canaan (NASDAQ:CAN) have not fared as well, however, with its stock price down nearly 70% YTD or from around $6 to $1.92 at press time.
All data is taken from the source: https://cointelegraph.com/
Article Link: https://cointelegraph.com/news/bitcoin-mining-firm-northern-data-slams-trolls-after-stock-drops-40
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