After delistings, warnings and even regulatory actions in different markets around the world, we are now getting another indication that the “blockchain” stocks hype is dying out. A TASE shell company has switched its focus from trying to enter the blockchain racket to newer trends like the legal cannabis business.
Fantasy Network is a shell company traded on the Tel Aviv Stock Exchange (TASE: FNTS). On Monday the company announced drastic changes to its leadership, ending all the plans it previously had to enter the blockchain space. The company’s CEO quit last week after FNTS attempt to merge with A2Z Blockchain Technologies failed.
FNTS has switched its focus a number of times in recent years. At one point it was a Biotech company, specializing in the cryo-preservation of amniotic fluid stem cells. Later it was in the online gaming business, offering technology solutions to fantasy sports operators, hence the name. Its plans to enter the blockchain space were first announced by Fantasy Network about six months ago.
On December 10, 2017, following the company’s report that it was examining the possibility of operating in the field, the company’s stock price skyrocketed by hundreds of percentages within a few days. However, towards the end of December, following warnings by then-chairman of the Israel Securities Authority, Prof. Shmuel Hauser, about preventing “backdoor listing” by bitcoin-related companies, the FNTS share plummeted back down.
The decision by the board of directors to remove the previous leadership came after several of the company’s shareholders claimed that the board had made “wrong decisions” in a manner that “jeopardized the company’s continued normal operations.” They thought that the merger deal was miscalculated and that “the risk inherent” will harm the shareholders in the company. “This is a research company, with unproven technology, and its value is not based on an income forecast.”
The shareholders who requested the cancellation of the merger deal added that they intend to “work to create significant value for the company.” And for this purpose they “examined a number of alternative deals in areas that are preferable, for example in cannabis, which is an evolving and regulated field.”
What does this development mean for “blockchain” companies? Share your thoughts in the comments section below.
Images courtesy of Shutterstock.
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