Investigation into Cryptocurrency Trading
Recent revelations from a Wall Street Journal report have indicated that United States financial authorities are launching probes into suspicious trading behaviors connected to more than 200 companies that have recently declared intentions to integrate cryptocurrency reserves into their business models.
Regulatory Concerns
Both the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) have reached out to several of these firms, expressing their worries regarding unusual spikes in trading activity and sudden surges in share prices. These communications were sent just prior to the companies’ public declarations and raise concerns about potential violations of the Fair Disclosure Rule.
Potential Insider Trading Investigations
Legal experts suggest that such notifications could signify the onset of more extensive investigations related to insider trading practices. In the last few months, numerous firms have adopted similar strategies to that of MicroStrategy (MSTR.O), which has successfully raised capital through equity and debt offerings specifically for the purpose of acquiring Bitcoin and other digital currencies.
“These communications were sent just prior to the companies’ public declarations and raise concerns about potential violations of the Fair Disclosure Rule.”
