Vaneck warns about small businesses with plans to create crypto reserves

According to Matthew Sigel from Vaneck, It is increasing the trend of companies that announce ambitious crypto reservation plans, which have no capacities to support the investments they announce. This can be provided for schemes “Pump and Dump.”

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• Several companies with low stock capitalization have announced plans to accumulate crypto reserves.
• Sigel of Vaneck He points out that many of these ads could be attempts to inflate the price of shares.
• The Sec He has already received complaints linked to these initiatives, but the viability of the plans remains uncertain.

The investment fund managing company based on cryptocurrencies, Vaneck, He warns about an unusual trend among small businesses that quote on the stock market, which announce ambitious crypto reserve plans with popular altcoins, all to inflate the value of their actions and perpetrate a scam through media manipulation.

Scams “Pump & Dump”

The warning was made by the director of the Digital Assets Area to Vaneck, Matthew Sigel, who during an interview for the medium The Block He warned about these deliberate movements perpetrated by these companies, which qualify as schemes “Pump and Dump.”

“Internal attempts of stock market manipulation, many of them”Sigel said. “If market capitalization is minimal and there is no dissemination of new anchor investors, I assume it is a scam.”

Under this type of scheme, Companies seek to attract investors and inflate the value of their shares through apparently very encouraging ads, and once they revalue, the largest holders that are generally within these same companies sell large quantities, deriving in a fall that ends up affecting the rest.

Sigel was one of the first to alert about this new wave of ads when, last month, an American company called Addentax Group Corp With capitalization of USD $ 3 million, directed by Chinese executives, he informed that he planned to acquire BTC and memecoin Trump for which they would seek to raise some USD $ 800 million.

The firm in question was Addentax Group Corp., a clothing manufacturer with headquarters in China and listing in the market OTC of Nasdaq. At that time, their shares quoted at USD $ 0.63 and its market capitalization was just a few million.

There have also been similar cases with other popular altcoins. One of the most recent is that of a Singapore -based company called Trident Digital Techwhich announced plans to raise up to USD $ 500 million to establish one of the first large corporate treasures in XRP. Their shares quoted below USD $ 0.40, with a market capitalization of just USD $ 16 million.

On the other hand it is Classover Holdings Inc.an educational technology company based in the US Solarium. This company also quote on Nasdaq, with a capitalization below USD $ 100 million and shares below USD $ 4.

We also have a Webus International, Chinese company dedicated to sectors as varied as the car and hospitality, also notified the US stock and values ​​commission. UU. (Sec) his intention to build a treasury of XRP worth up to USD $ 300 million. Its capitalization is also lower than USD $ 100 million and their shares are quoted below USD $ 3.

Taking advantage of the rise of the great participants

According to Sigel, these small participants perceive the success that other great exponents have had when announcing and executing ambitious crypto reservation plans.

Perhaps the most remarkable case is that of Strategy, Company founded and directed by Michael Saylor, which has been executing an aggressive accumulation strategy for years Bitcoin, which has made it the institutional investor with the greatest reservations BTC currently. The weekly company informs large purchases, and periodically announces the issuance of new types of shares to raise more capital for this purpose.

Out of the sphere BTC, Other companies are opting for very popular Altcoins. Among these stands out Defelopment Corp, who replicate the path of Strategy but invest in Solarium. The goal is to raise up to USD $ 5,000 million to accumulate SUN, and derive additional profits by providing the funds in Staking.

Back with Sigel’s warning, he reports that more and more companies want to take advantage of this speculative boom. For now, the regulatory authorities have not directly intervened, although the growing number of statements of this type could attract more attention from the Sec.

The phenomenon raises questions about the limits of crypto enthusiasm in companies that, in many cases, seem to have no fundamentals to sustain these millionaire bets.

Article written by a content editor. Edited by Angel Di Matteo / Diariobitcoin

Original image of Diariobitcoin, created with artificial intelligence, for free use, licensed under public domain.

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