The Securities and Exchange Commission has halted trading of a company after its stock boomed by over 2,000% following a recently announced crypto treasury pivot.
Digital advertising firm QMMM Holdings earlier this month announced a plan to buy Bitcoin, Ethereum, and Solana—causing an explosion in the price of its stock. In September alone, its price has risen by more than 2,100%, according to Yahoo Finance data, finishing Friday at a price of $119.40.
But Wall Street’s biggest regulator said Monday that it was suspending trading of the security until October 10 as it investigates “potential manipulation” of the stock.
“The Commission temporarily suspended trading in the securities of QMMM because of potential manipulation in the securities of QMMM effectuated through recommendations, made to investors by unknown persons via social media to purchase the securities of QMMM, which appear to be designed to artificially inflate the price and volume of the securities of QMMM,” the statement from the SEC read.
Decrypt reached out to the SEC and QMMM Holdings for comment, but did not immediately receive a response from either party.
Hong Kong-based QMMM Holdings said at the start of the month that its treasury will initially start with $100 million worth of cryptocurrency.
The SEC’s announcement comes as regulators pay closer attention to digital asset treasuries—companies that buy cryptocurrency with spare cash. Last week, the Wall Street Journal reported that the SEC and the Financial Industry Regulatory Authority, or FINRA, had contacted companies after identifying unusual trading activity.
A number of companies have bought cryptocurrencies like Bitcoin, Ethereum, and Solana to get better returns for shareholders. Such firms have often seen their share prices soar—albeit sometimes briefly—after announcing crypto treasury pivots.
