MGT Capital Investments Inc. (OTCMKTS:MGTI) is bouncing upwards after a 52-week low. MGTI is a bitcoin miner that runs operations in Washington and Sweden. The company is under a class action lawsuit for pump-and-dump allegations and it appears as if the shorts are closing out their trades here as the stock has surged more than 100%. MGTI has value in some capacity and the shell of the company could transition into a new operation in the cryptocurrency space.
With all this attention, the volume has increased from 1 million to 11 million per day. If readers are not familiar, MGTI was once associated with John McAfee, but also came under SEC investigation for securities fraud. “We will not be distracted in our mission to grow our cryptocurrency mining operations. We have been analyzing several low-cost energy opportunities in the U.S. and Sweden and look forward to updating shareholders more fully in the near future,” said Stephen Schaeffer, Chief Operating Officer. In addition, on September 10th, MGTI announced Robert Ladd, its President and Chief Executive Officer, is taking a leave of absence to focus on addressing the allegations leveled by the SEC.
MGT Capital Investments Inc. (OTCMKTS:MGTI) pivoted its operations entirely into the cryptocurrency space last year, ramping up its Bitcoin mining operations in the state of Washington and northern Sweden, and divesting itself of its cybersecurity segment.
MGTI engages in bitcoin mining operation and recently also ramped up its Ethereum mining operations as well. MGT Capital Investments, Inc. was founded in 1979 and is headquartered in Durham, North Carolina.
According to company materials, “With facilities in northern Sweden and WA state, MGT Capital Investments, Inc. (OTCQB:MGTI) ranks as one of the largest U.S. based Bitcoin miners. Further, the Company continues to execute on an expansion model to grow its crypto assets materially. The Company also owns a portfolio of cybersecurity technologies, including the Company’s first product, Sentinel, an enterprise-class network intrusion detector which was released in October 2017. The Company also owns the intellectual property associated with developing and marketing a mobile phone with extensive privacy and anti-hacking features. The cybersecurity products were guided by John McAfee, the Company’s former Chief Cybersecurity Visionary. MGT is presently evaluating various alternatives for its cybersecurity business.”
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This lawsuit came as sentiments in the crypto space were shifting. On the financial side, MGTI reported revenues from bitcoin mining of $409,000 in the second quarter of 2018, ending June 30, 2018 versus $388,000 in same quarter in 2017, and $956,000 in the first quarter of 2018. Revenues derived from the bitcoin production of investor owned machines are not included in our reported figures. Including these partnerships with investor-owned machines, the company produced 162 Bitcoins in the quarter just ended, compared to 94 BTC for the first quarter.
MGT Capital Investments Inc. (OTCMKTS:MGTI) is going to be going for a wild ride the next few weeks, but MGTI does have miners and bitcoins to hold onto. The company is probably going to be mercurial over the next few weeks, but if bitcoin resurges, they could be back on our radar. As of now, many people here are selling the rumor and buying the bad news. Sign-up for continuing coverage on shares of $ALEAF stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in $MGTI, either long or short, and we have not been compensated for this article.