The US Securities and Exchange Commission (SEC) has paused trading of QMMM Holdings for now because they are worried about possible stock manipulation related to the company’s recent shift into cryptocurrency.

Main Points:

• The SEC has stopped trading of QMMM Holdings because they are worried about stock manipulation related to its shift to cryptocurrency.
• QMMM’s stock price went up almost 1,800% after they announced they had investments in cryptocurrency and a $100 million supported platform.
• Regulators are looking more closely at companies using cryptocurrency investment strategies because of worries about possible market manipulation caused by excitement.

The trading stop started on Monday and will last for 10 trading days.

The SEC said in its announcement that QMMM stock might have been influenced by unknown people making suggestions to investors on social media. These suggestions could have been trying to raise the stock price and the amount of trading.

QMMM Jumps Almost 1,800% in One Day After $100 Million Crypto Platform Announcement

Shares of QMMM Holdings went up more than 1,700% in the last month after the company announced on September 9 that it will start buying and keeping Bitcoin, Ethereum, and Solana as part of its strategy to invest in cryptocurrencies.

The stock jumped from $11 to a record high of $207 in one day after news about starting a crypto analytics platform that is supported by $100 million in crypto assets.

QMMM was last sold at $119. 40 on Friday, which is up from about $6. 50 a month ago.

The suspension comes just days after a report from the Wall Street Journal said that the SEC and FINRA started investigating several companies about recent jumps in crypto-related stock prices.

The investigation is looking into whether certain companies or people took part in advertising stocks or wrongly shared secret information to profit from quick price changes.

Many companies are becoming interested in holding digital money, with over 200 of them sharing their plans to do so recently.

These strategies can boost stock prices, but experts say they are becoming too popular and risky. This is especially true if falling cryptocurrency prices erase profits on financial reports.

Crypto companies are losing interest in using their cash reserves and are instead choosing to buy back shares by borrowing money

The strategy of using cryptocurrency that became popular with small companies in 2024 is starting to fall apart. Many of these companies are now using borrowed money to buy back their own shares in order to deal with their dropping stock prices.

At least seven companies, including ones in gaming, biotech, and electric vehicles, are now worth less than the value of their cryptocurrency. This has made investors and experts concerned.

Critics say that this approach shows a lack of confidence and goes away from the original belief that just the increase in cryptocurrency value would benefit shareholders.

One important example is ETHZilla (previously called 180 Life Sciences). Its stock fell by 76% even though the company collected ether and changed its name.

The company recently got $80 million in loans to help pay for a $250 million buyback. Empery Digital, which used to be called Volcon, has $476 million in Bitcoin but is only worth $378 million as a company. Because of this, it is looking to grow.

ts loan option for buying back similar things.

A new report from K33 Research shows that 25% of public companies that own Bitcoin are now valued less than the amount of Bitcoin they have. This indicates a big decrease in investor confidence.

The increasing discount, called the NAV gap, is making it hard for companies to raise money. This is especially tough for smaller companies like NAKA, which has lost 96% of its market value.