Long Island Iced Tea abandons plan to sell shares to buy cryptocurrency mining servers

New stock offering called off, but mining hardware investment plans remain unchanged

Beverage company The Long Island Tea Company, which enjoyed a sudden spike in its stock price when it changed its name to Long Blockchain, has scrapped plans to raise funds via a new share offering in order to purchase Bitcoin mining hardware.

Last month, the business made headlines across the world when it renamed itself to "Long Blockchain" as part of plans to implement blockchain into its business strategy. As a result, the company's value tripled.

And by the end of last week, the firm shared more details about its plans for blockchain and cryptocurrency technology. It said it'd launch a stock offering to raise $8.4 million.

The company was then going to use this cash to purchase 1,000 Antminer S9 bitcoin mining computers, which the firm wants to install "in a world-class third-party data center experienced in cryptocurrency mining and located in a Nordic country".

Long Blockchain appears to have changed its mind, though, announcing that it won't be going ahead with "previously announced public offering of common stock at this time". The firm didn't give a reason as to why it's scrapping these plans.

But it is continuing with plans to purchase these mining rigs, along with 1,000 APW3++ PSUs. The firm expects this hardware to ship in January 2018 "for immediate commencement of mining operations".

The reason for the cancellation was quite simple: the company admitted that the stock offering may not take off: "Notwithstanding its intent to close on the proposed acquisition, the company can make no assurances that it will be able to finance the purchase of the mining equipment."

It added that it "continues to evaluate and explore multiple specific opportunities involving blockchain technology, including potential partnerships, investments and acquisitions.

"Blockchain acts as a public, decentralised ledger. This ledger provides a single, unified source of data, creating a clearer audit trail and consistency across parties," said the firm.

It concluded: "The company believes that emerging blockchain technologies are creating a fundamental paradigm shift across the global marketplace, with far reaching applications across all industries."