US securities regulators on Tuesday temporarily suspended trading in the shares of Crypto Company, a small firm that saw its stock rise more than 2,700 percent this month after signing a deal to buy a cryptocurrency data platform.
The Securities and Exchange Commission cited concerns about the ‘accuracy and adequacy of information’ about the Malibu, California-based company available to investors. The suspension will remain in place until January 3.
‘Questions have also arisen concerning potentially manipulative transactions in the company’s stock in November 2017,’ the SEC said in a Monday press release.
Crypto Co, which says it provides a ‘portfolio of digital assets, technologies, and consulting services to the blockchain and cryptocurrency markets,’ changed its name from Croe Inc to Crypto Company in October.
The Securities and Exchange Commission (whose Washington, DC headquarters are seen above) temporarily suspended trading in the shares of Crypto Company, a small firm that saw its stock rise more than 2,700 percent this month
The Crypto Company’s shares skyrocketed this month after signing a deal to buy a cryptocurrency data platform
Crypto Co’s stock hit $575 on Monday, rising from $3.50 in late September. The company’s market value surpassed $11billion, almost equaling that of home appliances maker Whirlpool Corp or railroad Kansas City Southern
In late November, the over-the-counter-traded company announced a deal to buy a majority stake in Coin Tracking e.K., a German cryptocurrency data platform.
Investors have been pouring millions of dollars into companies with ‘crypto’ or ‘blockchain’ in their names, reminiscent of the late 1990s, when firms with ‘.com’ in their names saw their shares surge.
Bitcoin, the world’s best known cryptocurrency, has risen more than 1,800 percent this year as mainstream exchange companies introduced futures trading in the virtual currency.
Crypto Co’s stock hit $575 on Monday, rising from $3.50 in late September.
The company’s market value surpassed $11billion, almost equaling that of home appliances maker Whirlpool Corp or railroad Kansas City Southern.
Global financial regulators are beginning to warn the public against the risks of investing in a market that many feel is in a speculative bubble, with Singapore’s central bank on Tuesday urging ‘extreme caution’ about buying cryptocurrencies.
The staggering growth of bitcoin and other decentralized digital currencies this year – with the market swelling from around $17billion at the start of January to well over $600billion now – has led to increasing concerns over what the fallout could be if the bubble were to suddenly burst.
Bitcoin, the world’s best known cryptocurrency, has risen more than 1,800 percent this year as mainstream exchange companies introduced futures trading in the virtual currency
There have also been worries that regulators have not been doing enough to protect consumers.
Many, though, say investors must take responsibility and must not expect protection if they lose money because of the difficulties of regulating an opaque, complex market that has no centralized authority.
The Monetary Authority of Singapore (MAS) said in an official statement on Tuesday it is ‘concerned that members of the public may be attracted to invest in cryptocurrencies, such as bitcoin, due to the recent escalation in their prices’.
‘MAS considers the recent surge in the prices of cryptocurrencies to be driven by speculation,’ the central bank said in a statement.
‘The risk of a sharp reduction in prices is high. Investors in cryptocurrencies should be aware that they run the risk of losing all their capital.’
The city-state’s central bank added that there is no regulatory safeguard for investments in cryptocurrencies and that it does not regulate them either.
It urged the public to act with ‘extreme caution’ and to understand the ‘significant risks’ they take on if they invest in virtual currencies.
Denmark’s central bank on Monday said bitcoin investing was ‘deadly’, warning the public to steer clear of it.
It also said potential investors should not complain to financial regulators if things do go wrong.
A survey by the Centre for Macroeconomics and the Centre for Economic Policy Research released on Tuesday found a majority of leading European economists were in favour of greater regulatory oversight of the market, primarily because of concerns that cryptocurrencies facilitate tax evasion and other criminal activity.
But a large majority of the economists agreed that the market did not represent a threat to the stability of the financial system – now or in the next couple of years – as mainstream financial markets were isolated enough from bitcoin.
They also took the view that the cryptocurrency market was still relatively small.
European Union states and legislators agreed last week on stricter rules to prevent money laundering and terrorism financing on exchange platforms for bitcoin and other virtual currencies, but it has not moved to regulate the market beyond that.
Late in 2013, the EU issued a formal warning on the risks of using unregulated online currencies, warning that bitcoin investors would be on their own if they lost money.
Bitcoin set a record high of $19,666 on Sunday on the Luxembourg-based Bitstamp exchange, its prices having surged more than twentyfold this year.
On Tuesday, it stood at $17,942, down more than 5 percent on the day.