Long before the Blockchain was called a Long Island Iced Tea and engaged in the production of cold tea. Then the user was able to raise the stock price 500% only because of the name change. However, syllogism has led to unpleasant consequences. Now the company is under investigation FBI investigation on insider trading.
Small OTC company was able to spin, swinging the stock price and disease in cryptocurrency HYIP. The creators changed the name, added the word “blockchain”, spoke about the desire to mine Bitcoin and got an incredible increase in share price. About changing directions told major cryptocurrency media. As a result, the manufacturer has received great popularity and, accordingly, new investors wishing to buy shares.
FBI officials believe that this was all planned. In other words, the executives hoped for cryptocurrency HYIP and possible stock appreciation. So the whole idea needed solely to fatten the pockets of money.
In General, it is often difficult to find evidence of artificial Pampa, that is, deliberate over-pricing of stock or cryptocurrency. However, in this case at the disposal of the FBI has some information on this.
For example, at the moment, the staff managed to identify a large investor Long the Blockchain under a pseudonym Eric W — most likely, we are talking about Eric Watson. He invested in the company immediately before the rapid growth of its capitalization. While in the FBI study of corporate communication in an attempt to find messages that would indicate a deliberate pump on the stock market. Among the suspects is listed and Julian Davidson, who had previously held the position of Director.
Recall, the company staged the best rebranding in December 2017 — just in time for the cryptocurrency hype. This is partly helped the company to attract more attention.
The use of the term “blockchain” for the main financial products were so common that the SEC was forbidden to apply them if the basis for exchange traded funds or so-called ETF. The SEC also has questions regarding the activities of Long Blockchain (LTEA).
In fact, the LTEA can’t ever quite issued assets on the blockchain, whether it’s cryptocurrency or token. The company just attracted financing through the sale of stock, taking advantage of favorable naming. Sounds logical, but it is unlikely to pull on the legality.
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