Australian-led Crypto Company has been suspended from trading for two weeks to protect investors.
Australian-led fintech firm Crypto Company has been temporarily suspended from trading by the US Securities and Exchange Commission, after its market value surpassed $11 billion.
Two weeks ago, the company’s co-founder, president and largest shareholder Australian James Gilbert became a cryptocurrency billionaire, following in the footsteps of the Winklevoss twins — who were reportedly the first to achieve the feat.
Mr Gilbert’s fortune has come off the back of the skyrocketing value of its stock, which is traded over-the-counter.
This month alone, its stock jumped 2,700% after it announced a deal to buy a majority stake in Coin Tracking e.K., a German cryptocurrency data platform.
In October, the company changed its name from Croe Inc to Crypto Company, presumably to take advantage of the bitcoin frenzy. It says it provides a “portfolio of digital assets, technologies, and consulting services to the blockchain and cryptocurrency markets”.
The California-based company’s shares hit a high of $642 earlier this month and were trading at $575 on Monday before SEC issued the suspension, which will remain in place until January 3.
In handing down the freeze, the SEC said it was concerned about “the 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”.
“Questions have also arisen concerning potentially manipulative transactions in the company’s stock in November 2017,” it added in a statement.
Mr Gilbert describes himself as a “serial entrepreneur” on his LinkedIn account, and most notably (prior to Crypto Co) co-founded start-up Jump On It, which was acquired by US giant LivingSocial for a reported $40 million total in 2012.