Mushroom Seller's Stock Surges 350% Following Crypto Memecoin Activity
Mushroom seller's stock jumps 350 percent following crypto trading activity
Farmmi (FAMI), a Chinese agricultural company that sells dried mushrooms, saw its Nasdaq-listed stock price surge as much as 350% on Wednesday. The sudden price move occurred as traders piled into a memecoin—a type of cryptocurrency often based on internet jokes or trends—that was linked to the company's ticker symbol on a blockchain.
A blockchain is a digital ledger that records transactions across a network of computers. The stock, which closed Tuesday at approximately $0.12, briefly reached $0.50 per share. It later corrected to around $0.18 as trading calmed.
Trading volume spikes to 90 times the daily average
- More than 720 million Farmmi shares were traded during the surge.
- This trading volume was nearly 90 times higher than the stock's typical daily average.
- The memecoin associated with the surge reached an implied valuation of $60 million at its peak.
- The digital token's valuation was roughly 10 times higher than the actual market value of the publicly traded company.
Activity linked to unofficial tokens on Robinhood Chain
The stock's volatility was tied to a memecoin called JINQIAN on Robinhood Chain. This memecoin was paired against an on-chain digital token using Farmmi’s FAMI ticker. While other tokens on the network have been paired with large companies like Nvidia or Micron, Farmmi is a much smaller company with only 15 employees.
It is important to note that the FAMI token used in this pairing is not an official stock token from Robinhood. Because it was issued independently, there is no official mechanism to turn the digital tokens into actual Nasdaq-listed shares. Instead, speculators likely saw the activity on the blockchain and moved to buy the real stock through traditional brokerages.
The connection between digital tokens and traditional stocks
This event follows a growing trend on Robinhood Chain where memecoins are paired with tokenized versions of stocks. This allows digital assets to be traded against equities rather than standard cryptocurrencies like Bitcoin or stablecoins—digital tokens designed to maintain a steady value.
In the case of Farmmi, the extreme price movement highlights how speculative activity in the crypto market can spill over into the traditional stock market, particularly for small-cap companies with lower trading volumes.
