Crypto treasury hype triggers SEC and FINRA investigations into stock spikes

More than 200 companies that claimed they were switching to a crypto-treasury strategy are now on the radar of ￰0￱ the Securities and Exchange Commission and the Financial Industry Regulatory Authority have contacted these companies after spotting sudden spikes in stock prices and trading activity just days before their public crypto ￰1￱ to the Wall Street Journal, regulators saw a pattern: big trades, wild price jumps, and then—surprise—a company would come out and say they’re going all in on ￰2￱ SEC and FINRA are now digging to find out who knew what, and ￰3￱ those contacts, the SEC reportedly warned companies about breaking Regulation Fair Disclosure, or Reg FD, which bans companies from leaking important, non-public news to people who might try to trade on ￰4￱ flag price jumps and leaked crypto deals The Finra letters didn’t just say ￰5￱ to legal experts, these types of letters usually kick off serious investigations.

“When those go out, it really stirs the pot,” said David Chase, a former SEC enforcement lawyer who now defends clients in these cases. “It’s typically the first step in an ￰6￱ it goes full, full length, it’s anybody’s guess.” Right now, it’s unclear if any actual enforcement actions are coming, or if any specific company or investor is already being ￰7￱ these letters alone are enough to make executives ￰8￱ situation comes at a time when the SEC is trying to shift its tone with the crypto ￰9￱ a recent speech, SEC Chairman Paul Atkins called out the old tactics, accusing the agency of having “weaponized” its enforcement division in the past to crack down on the ￰10￱ promised the SEC will now focus on setting “clear, predictable rules.” While that speech may have sounded like a peace offering, these new probes suggest the SEC isn’t putting its badge down anytime ￰11￱ rushed into crypto with $102B and shaky NDAs The crypto-treasury trend exploded this ￰12￱ to Architect Partners, a firm that tracks the industry, 212 companies have announced plans to raise around $102 billion to buy bitcoin and other ￰13￱ model they’re copying?

Strategy, the company formerly known as ￰14￱ raise funds by selling stock or taking on debt, then use the cash to load up on ￰15￱ going public with their strategy, these companies usually talk to a few handpicked investors to see who’s interested in joining the ￰16￱ there’s a ￰17￱ investors are expected to keep quiet by signing nondisclosure ￰18￱ is, those NDAs aren’t always ￰19￱ of the companies saw their stock prices shoot up before they made any announcements. That’s what triggered the SEC and FINRA ￰20￱ someone leaked, and people traded on that info, it smells like insider ￰21￱ that leak doesn’t just break rules, it can wreck the ￰22￱ Platt, a partner at law firm Goodwin, said, “If the stock price is highly volatile in the days leading up to pricing a transaction, that could actually make it very difficult to agree on a price for the transaction and put it at risk of execution.” So now, what started as a rush into crypto could end up as a lesson in how not to fumble your treasury strategy while everyone’s ￰23￱ up to $30,050 in trading rewards when you join Bybit today