(Bloomberg) — The US Securities and Exchange Commission suspended trading in QMMM Holdings Ltd. after its shares surged almost 1,000% in less than three weeks, saying the digital media advertising firm’s stock may have been manipulated by touts on social media.
QMMM’s stock has surged 959% since before the company said earlier this month that it was establishing a “diversified cryptocurrency treasury” that would initially reach $100 million and target Bitcoin, Ethereum and Solana.
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In its Sept. 9 release, QMMM also said it was announcing its “strategic entry into the cryptocurrency sector,” citing the use of artificial intelligence and blockchain technology.
Recommendations on social media by “unknown persons” to buy QMMM may have manipulated the share price, the SEC said Monday. The regulator didn’t say when the posts were made. The SEC said the suspension was temporary, ending at 11:59 p.m. ET on Oct. 10.
Crypto treasury firms, which accumulate various tokens, have become increasingly popular this year. Some of these firms have seen sharp share declines.
The SEC also suspended on Monday the trading of Smart Digital Group Ltd., citing similar reasons. That suspension is set to end at 11:59 p.m. ET on Oct. 10.
The firm said last week it was establishing a “diversified cryptocurrency asset pool” that would focus on investing in digital assets like Bitcoin and Ethereum. Its stock price plunged since the announcement.
QMMM and Smart Digital Group didn’t immediately respond to requests for comment sent outside of normal business hours. Nasdaq, where the companies trade, declined to comment.
During both the first Trump and Biden administrations, the SEC pursued enforcement actions that focused on touts on social media related to digital assets.
(Adds Nasdaq decline to comment in eighth paragraph.)
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