The Securities and Exchange Commission (SEC) announced that it has suspended trading on a temporary basis for The Crypto Co – a cryptocurrency company that has witnessed its share prices go up by 17,000 percent during the last 90 days. The US regulator said that it had concerns over shares being manipulated and inaccurate data being shared to its investors.
The global cryptocurrency market has gained immense popularity in 2017 and that is mostly because Bitcoin – the most popular cryptocurrency has seen its value skyrocket from $950 in Dec 2016 to $18,000 in Dec 2017. Cryptocurrency companies have benefitted greatly from this surge in Bitcoin prices and the overall popularity of cryptocurrencies.
The Crypto Co has been one of the biggest beneficiaries of this cryptocurrency boom atleast on paper. The company has lost over $2.7 million and has posted revenues of a few hundred thousand dollars but when one looks at its market capitalization, the Crypto Co is worth a massive $11 billion. James Gilbert, President of the Crypto Co has also turned into a billionaire in the process and is estimated to have a paper fortune of $4.2 billion as of this week.
The SEC will look into the sudden increase of share prices and how the company is doing business. Shares for Crypto Co last traded at $575 per share before the SEC decided to temporarily halt sharing till Jan 3. The SEC has said that in November 2017 there were concerns raised over certain transactions being manipulated to boost share prices. Crypto Co is yet to respond to the SEC’s temporary suspension.
In a statement, the SEC said it had concerns over the
accuracy and adequacy of information in the marketplace about, among other things, the compensation paid for promotion of the company, and statements in Commission filings about the plans of the company's insiders to sell their shares of The Crypto Company's common stock.
The global cryptocurrency market is an unregulated market and this is one of the main reasons why regulators from different countries have issued numerous warnings in the last few months, urging investors to be extra cautious when they invest into cryptocurrencies and companies dealing with cryptocurrencies.
OTC Markets Group has been keeping a close watch on the share prices of The Crypto Company and had recently inputted a skull with crossbones symbol against the Crypto Company’s stock symbol in December, warning investors to be weary when dealing with the Crypto Company.