Lionsgold suffers from Metal Tiger and Cryptocurrency sell off

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Lionsgold (LION) dropped a further 7% yesterday to hit 4.275p following a combination of factors. Firstly there was the sale of 320,711,718 of shares by Metal Tiger Ltd, representing 7.3% of the equity, announced on December 20th. Secondly, the company may have been caught up in the crpytocurrency sell off, where Bitcoin dropped 20% plus, because of the link with the blockchain product, GoldBloc. GoldBloc is a collaboration between LION, TRAC and Railsbank. Unkike crpytocurrencies, Goldbloc is linked to the actual gold price, with each Goldbloc unit representing 1/1,000th of a gram of physical gold.

Lionsgold Share price December 17-22 2017

Metal Tiger also sold a 3.4% stake in Greatland Gold (GGP) on 24th October. In both cases, Metal Tiger has made some serious money from their investments before bailing out.  Metal Tiger's mission is to deliver a high return for shareholders by investing in significantly undervalued and/or highly prospective opportunities in the mineral exploration and development sector timed to coincide where possible, with a cyclical recovery in the exploration and mining markets.

LION also announced the 

"In recent days Lionsgold has received the proceeds of the first unconditional tranche of the placing, being £220,000, and an additional £811,785 through the exercise of warrants and a former employee exercising management options.

"Subject to the relevant resolutions being passed at the AGM on 28 December 2017, the second tranche of the placing monies will be received which, including £52,000 from management partipation, totals £582,000.  At that point, Lionsgold will have received over £1.6 million during December.  The Company will also be in a position to trigger the early exercise of Placing Warrants representing a potential £1.1 million in additional cash, but Lionsgold does not intend to trigger early exercise of the Placing Warrants at this time.

LION also put out an RNS relating to the Right of Company to Expedite Exercise of Placing Warrants. 

"In recent days Lionsgold has received the proceeds of the first unconditional tranche of the placing, being £220,000, and an additional £811,785 through the exercise of warrants and a former employee exercising management options.

"Subject to the relevant resolutions being passed at the AGM on 28 December 2017, the second tranche of the placing monies will be received which, including £52,000 from management partipation, totals £582,000.  At that point, Lionsgold will have received over £1.6 million during December.  The Company will also be in a position to trigger the early exercise of Placing Warrants representing a potential £1.1 million in additional cash, but Lionsgold does not intend to trigger early exercise of the Placing Warrants at this time.

"The recent placing and voluntary exercise of warrants to date gives Lionsgold a robust cash position and the Company is now in a position to develop and execute strategies that the Board believe can significantly enhance the value of Lionsgold over the next two quarters."

Investors will be looking for news on Goldbloc in 2018 for a share price recovery but at least the company has plenty of cash in hand after the placing and warrants. Expect more serious volatility ahead that's for sure.