SEC Halts Cryptocurrency Firm’s Trading After Bitcoin’s Rise
By Ryan Velez
Bitcoin is exploding in value, to the point where some are getting concerned. The Daily Mail reports that 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 SEC cited concerns about the Malibu-based company and the “accuracy and adequacy” of information made available to investors. This suspension will remain until January 3rd.
'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. In November, it bought a major stake in Coin Tracking e.K., a German crypto currency platform. This is leading investors to pour money into companies with crypto or blockchain in their names, comparable to the .com rise in the late 90s.
Crypto Co's stock hit $575 on Monday, rising from $3.50 in late September. The company's market value surpassed $11 billion, almost equaling that of home appliances maker Whirlpool Corp or railroad Kansas City Southern.
There is concern in the midst of all this that regulators are not doing enough to protect consumers. However, others are saying the burden falls on those same consumers, saying that it’s difficult to expect protection in a decentralized market with no 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.