Shares of Digital Currency X Technology Inc. (NASDAQ:DCX) are trading sharply lower Friday afternoon as investors react to a registered direct offering.

• Digital Currency X stock is testing key support levels. Why did DCX hit a new low?

$5 Million Registered Direct Offering Details

The catalyst for Friday’s decline was the company’s announcement on Friday that it priced a $5 million registered direct offering. DCX agreed to sell 23,809,530 Ordinary Shares (or pre-funded warrants) to institutional investors, alongside Series A and Series B warrants, at a combined purchase price of 21 cents per share.

The Series A warrants carry an initial exercise price of 44 cents per share and expire in five years, while the Series B warrants hold a 21 cent exercise price and expire in 30 days. The offering, managed by Maxim Group LLC, is expected to close on or about September 21.

DCX stated it intends to use the net proceeds for working capital and general corporate purposes, including the acquisition, holding, and staking of digital assets and cryptocurrencies. However, by issuing nearly 24 million new shares and accompanying warrants, the company is significantly expanding its outstanding share float.

DCX Shares Plunge Friday

DCX Price Action: Digital Currency X shares were down 72.71% at 11 cents at the time of publication on Friday. The stock is trading at a new 52-week low, according to Benzinga Pro data.

Image: Shutterstock

Disclaimer:This article represents the opinion of the author only. It does not represent the opinion of Webull, nor should it be viewed as an indication that Webull either agrees with or confirms the truthfulness or accuracy of the information. It should not be considered as investment advice from Webull or anyone else, nor should it be used as the basis of any investment decision.