U.S. regulators focus on unusual trading before cryptocurrency investments

ChainCatcher news, according to The Wall Street Journal, the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (Finra) are investigating multiple companies. These companies exhibited unusual trading activity before announcing plans to purchase digital assets such as Bitcoin.

Insiders say that regulators have contacted several companies, pointing out significant trading volume and stock price surges prior to their public disclosures of plans to acquire crypto assets, which may violate the Fair Disclosure Regulation (Reg FD), prohibiting companies from selectively disclosing significant non-public information to individual investors. Some lawyers indicate that such letters are often a precursor to insider trading investigations.