Canaan Faces Critical Hurdle as Share Price Decline Threatens Nasdaq Listing

The crypto mining hardware sector is experiencing significant turbulence, with Canaan Inc. now at the center of a delisting crisis. The company received notification from Nasdaq on Wednesday regarding non-compliance with listing requirements, specifically that its share closing bid price had fallen below $1 for 30 consecutive business days. This regulatory warning sets a critical juncture for the company: meet the minimum $1 per share requirement within 180 days, or face removal from the prominent exchange.

According to reporting from Cointelegraph, the stakes are concrete and time-sensitive. Nasdaq has established July 13 as the compliance deadline, requiring Canaan to maintain a closing bid price of at least $1 for a minimum of 10 consecutive trading days. The company’s shares last traded above this threshold on November 28. As of Friday, Canaan’s stock closed at $0.79—down 3.8% for the session—and has remained below $3 throughout the period since December 2024.

The AI Pivot and Its Cost to Hardware Manufacturers

The fundamental pressure on Canaan’s valuation stems from a broader industry transition. Crypto mining firms have increasingly redirected resources toward providing computational infrastructure for artificial intelligence applications, thereby reducing their demand for traditional crypto mining equipment. This strategic shift has directly impacted hardware manufacturers like Canaan, whose primary revenue model depends on sales to active miners. The resulting diminished equipment purchases have compounded the company’s financial challenges.

Strategic Response: The Reverse Split Option and Extended Timeline

Canaan has indicated that the company may request additional time from Nasdaq staff to achieve compliance. Should the regulatory body grant an extension, management is exploring a reverse stock split as a potential remedy—a financial mechanism that reduces the number of outstanding shares while proportionally increasing the per-share price. This restructuring could artificially elevate the bid price without fundamentally improving underlying business performance.

Failure to meet the requirement would trigger delisting, typically forcing the company’s shares to migrate to over-the-counter markets, where trading liquidity diminishes substantially and investor accessibility becomes more constrained.

Notable Counterpoint and Industry Precedent

In October, Canaan announced a significant development that temporarily reversed negative momentum: a major U.S.-based customer placed an order for 50,000 of its latest-generation Avalon A15 Pro mining rigs—the company’s largest order in over three years. The announcement catalyzed a 25% surge in the stock price, demonstrating the market’s responsiveness to genuine business wins.

However, broader industry trends suggest that such orders may not reverse systemic headwinds. Bitcoin treasury company Kindly MD received a similar delisting notice from Nasdaq in December, with shares trading at $0.46 on Friday. The firm has until June to rectify its share price, having last traded above $1 in late October. The parallel situation underscores how widespread this challenge has become across the crypto-adjacent sector.

Historical precedent compounds these concerns. In August, Nasdaq delisted Windtree Therapeutics, a biotech firm, for non-compliance. Following its removal from the exchange, the company’s share price collapsed by 77% as investors rapidly exited their positions ahead of the transition to OTC markets—a cautionary scenario that Canaan and other at-risk companies now contemplate.