Trading in shares of The Crypto Co. was temporarily suspended by the U.S. Securities and Exchange Commission on Tuesday. The stock has increased by over 2,700 percent in the last month.
The statement released by the commission explains that the suspension will last until midnight on Jan. 3rd.
The commission’s reasoning behind the suspension includes, “accuracy and adequacy of information in the marketplace about, among other things, the compensation paid for promotion of the company, and statements in commission filings about the plans of the company’s insiders to sell their shares of The Crypto Company’s common stock,” according to its statement.
The recent rise in its share price puts the company at a market value of over $11 billion. The company’s shares last traded for $575.
After announcing a 10-for-1 stock split last week, on December 14, the CEO, Mike Poutre, explained, “There are a lot of companies taking advantage of the euphoria associated with this space, and we do not want be associated with them.”
He went on to say, “We want people to pay attention to the business we are building, not the hype of a stock or the cryptocurrency world.”
The company, based in California, announced it had launched the first phase of trading operations and platforms for digital currencies on December 4th.
Crypto Co. was incorporated in March and its list of services includes investing, advising, and trading digital assets. The company went public in June, after acquiring Croe, a company currently in the developmental stages of fitness apparel, primarily sports bras.
Many small companies have suddenly experienced a surge in their stock after announcing some form of relationship with bitcoin or blockchain technology.
For example, the financial technology company, Longfin, gained popularity on Monday after announcing it was acquiring Ziddu.com, which is a microlending company based on blockchain. After sharing that information, the company experienced a two-day surge of over 2,500 percent.
Due to the cryptocurrency craze this year, the SEC has started to be more involved in trying to reduce speculative activity related to bitcoin and initial coin offerings.
Jay Clayton, the commission’s chairman, warned about the dangers of investing in cryptocurrencies and initial coin offerings, in a statement earlier this month.