Three Reverse Splits Hit the Nasdaq Tape Friday Morning. The market-value rule that would matter most to the companies behind them was approved on July 22, automatically stayed on July 29 and is not in force today.

by Kwame Osei · August 21, 2026

Market Structure Reporter, The MicroCap Herald

Three Nasdaq-listed companies changed the arithmetic of their share counts inside about seventeen hours this week. Smartkem, Inc. (Nasdaq: SMTK) consolidated 1-for-50 at 5:00 p.m. Eastern on Thursday, August 20, with split-adjusted trading beginning at Friday's open. PMGC Holdings Inc. (Nasdaq: ELAB) went 1-for-10 at 12:00 a.m. Eastern on Friday, August 21. Bit Origin Ltd (Nasdaq: BTOG) began trading on a 1-for-5 split-adjusted basis at Friday's opening bell. Smartkem and Bit Origin each said the aim was the minimum bid price requirement under Nasdaq Listing Rule 5550(a)(2); PMGC's release gives no reason. None of the three actions changes what any of the three companies is worth.

That distinction is the story at the bottom of the exchange right now, because the standard drawing attention this summer is not a price standard at all. It is a market-value standard, and its status is unresolved.

The Securities and Exchange Commission approved Nasdaq's new continued-listing standard on July 22, 2026, in an order under File No. SR-NASDAQ-2026-004 (Release No. 34-105971). The order requires listed companies to maintain a minimum market value of listed securities of $5 million, applies to the Nasdaq Global Select Market, the Nasdaq Global Market and the Nasdaq Capital Market, and provides no cure or compliance period: a security below the threshold for 30 consecutive business days draws a Staff Delisting Determination, and the order records Nasdaq's position that a timely Hearings Panel request would not stay the trading suspension, with the securities trading over the counter during any appeal. The order also records the position that companies' ability to regain $5 million of market value within 180 days of falling below it is limited.

It is not in force today. On July 29, 2026 — one week after approval — Cemtrex, Inc. and the Small Public Company Coalition filed notices of intention to petition the full Commission for review. Because the approval had been issued by the SEC's Division of Trading and Markets under delegated authority rather than by the Commission itself, that filing triggered an automatic stay under Rule 431(e) of the Commission's Rules of Practice, and the SEC confirmed in a letter that the approval order had been stayed pending further Commission action. Those procedural details are as reported by the securities bar, including the Public Company Advisory Blog and SecuritiesLawyer101, which also note that the Commission may affirm, modify, reverse, set aside or remand the matter, or decline review, and that no deadline governs that decision. A stay is not a finding that the rule is unlawful.

Netcapital Inc. described the same sequence in a July 31, 2026 update, dating the approval to July 22 and the stay to July 29, and cautioning in the release's own language that there can be no assurance as to the outcome or timing of the Commission's review.

PMGC Holdings published a release on July 29, 2026 — the same date as the stay — confirming its compliance with the requirement. That release describes the standard in the company's own words: “A company whose MVLS remains below the minimum for 30 consecutive business days may become subject to trading suspension and delisting proceedings without a cure period.” The company stated that “Based on PMGC's issued and outstanding common shares and the applicable market price as of July 29, 2026, the Company's MVLS exceeds the new requirement,” disclosed 8,095,835 shares of common stock issued and outstanding as of that date, and cautioned that “there can be no assurance that PMGC will continue to satisfy the requirement in the future.” The release states that the rule took effect immediately upon approval and does not mention the stay.

Three weeks later PMGC announced its consolidation. The August 19 release states that the 1-for-10 reverse split would take effect at 12:00 a.m. Eastern on August 21, reducing approximately 8,095,835 shares to approximately 809,584, with a new CUSIP of 73017P 607 and fractional entitlements resolved so that “Shareholders entitled to fractional shares will receive one full share for each fractional portion.” The release gives no reason for the split, and it makes the central point itself: “The reverse split does not impact the overall value of shareholder equity; it only reduces the number of shares outstanding while proportionally adjusting the share price.”

Run the two disclosures together and the limit of a consolidation sits in one line of arithmetic. The calculation that follows is the desk's own and appears in neither release. On PMGC's stated 8,095,835 pre-split shares, a $5 million market-value floor implies about $0.62 a share. On the approximately 809,584 shares the company expects after the split, the same $5 million implies about $6.18 a share. The threshold does not move and the company's market value does not move; the split changes only the per-share price at which the same market value is expressed. A consolidation creates headroom against a price test, not against a market-value test.

The reported numbers behind PMGC are qualified. Its second-quarter Form 10-Q, filed August 14, 2026, shows total assets of $36.56 million, total stockholders' equity of $16.74 million, cash and cash equivalents of $18.14 million and revenue of $1.31 million for the quarter, against a net loss of $2.94 million for the quarter and $7.91 million for the six months, an accumulated deficit of $28.93 million and $4.97 million of cash used in operations over the half. The filing states that these factors raise substantial doubt about the company's ability to continue as a going concern. The company has also drawn on equity-line financing arrangements, a structure that issues shares as it raises cash.

The contrast worth drawing is with the market-value standard that is in force. PS International Group Ltd. (Nasdaq: PSIG) disclosed on August 14, 2026 that it had received a notice dated August 12 for non-compliance with the $35 million minimum market value of listed securities that Nasdaq Listing Rule 5550(b)(2) sets for continued listing on the Nasdaq Capital Market, and that it also does not meet the alternative standards of $2.5 million in stockholders' equity under Rule 5550(b)(1) or $500,000 of annual net income from continuing operations under Rule 5550(b)(3). The two thresholds should not be confused: the $35 million test is the existing Capital Market standard PSIG is measured against, while the stayed $5 million floor would be a separate, lower minimum applying across all three Nasdaq tiers. PSIG disclosed a 180-calendar-day compliance period ending February 8, 2027 — 180 days from the August 12 notice — during which its market value of listed securities must close at or above $35 million for a minimum of ten consecutive trading days. Its release states that “This Nasdaq deficiency notice has no immediate suspension or delisting effect on the Company's ordinary shares.” Its continued listing is nonetheless at risk if the shortfall is not cured inside that window.

Two market-value tests, then, with very different consequences as their sponsors describe them: the $35 million standard PSIG is working against comes with 180 days and continued normal trading; the $5 million floor approved in July comes with neither, and is presently stayed. Which regime governs the smallest listed companies is a question for the Commission, not for the issuers consolidating their shares this week.

The tape they consolidated into was weak at the small end. Thursday, August 20 — the last completed session — closed with the Russell 2000 at 2,992.43, down 40.51 points or 1.34 per cent, the sharpest fall of the four major benchmarks on the Associated Press levels wire for the session. The S&P 500 closed at 7,641.16, down 66.82 points or 0.87 per cent; the Dow Jones Industrial Average at 52,759.21, down 703.84 points or 1.32 per cent; and the Nasdaq Composite at 26,067.17, down 263.92 points or 1.00 per cent. Small caps led the decline, the direction that matters most for issuers whose listing status is tied to market value rather than to revenue or equity.

The risks bear stating flatly. A reverse split raises the quoted price and cuts the share count; it does not add cash, reduce losses or lift market value. A company that consolidates and then keeps issuing shares can find the price back where it started with a smaller count and the same problem: Bit Origin's Class A count fell from approximately 88.6 million to approximately 1.5 million in the 1-for-60 consolidation effective January 20, 2026, had grown to 3,999,568 by this week's announcement, and goes to approximately 799,914 after Friday's 1-for-5. Smartkem's Form 10-K for the year ended December 31, 2025, filed in April 2026, discloses that recurring losses from operations have raised substantial doubt about its ability to continue as a going concern and reported cash of $0.4 million at year end. PMGC's second-quarter filing carries the same substantial-doubt language. All four companies named here are exposed to delisting if they breach a continued-listing standard: Smartkem and Bit Origin against the $1 minimum bid price under Rule 5550(a)(2), PSIG against the $35 million market-value test with its February 8, 2027 deadline, and every Nasdaq issuer against the $5 million floor if the Commission lets it stand as approved — in which case, on the order's terms, companies below it would have no cure period. Each of these companies has funded itself by issuing shares, and further issuance would dilute existing holders.

Friday, August 21 has not closed as this piece is filed, and no Friday price appears above. The near-term items to watch are the Commission's disposition of the stayed rule, whether the three consolidating issuers disclose confirmed post-split share counts, and whether PS International's market value recovers inside its stated February 8, 2027 window. This desk does not give investment advice.