The Securities and Exchange Commission (SEC) has suspended UBI Blockchain’s trading of shares. The regulator issued the suspension based on the following:
“(i) Questions of the accuracy of assertions…regarding the company’s business operations; and (ii) concerns about recent, unusual and unexplained market activity in the company’s Class A common stock since at least November 2017.”
According to a CNBC report, the company’s stock surged from $9 to $87 in a span of just one week last December, before it settled to $22 today.
The tide that lifts all boats
UBI Blockchain is one of the many companies that benefited from the Bitcoin and Blockchain frenzy that has affected the markets. The company which aims to use Blockchain technology to “trace a food or drug product from its original source” jumped from 55 cents in February 2017 to as high as $115 per share.
The company, formerly known as JA Energy, changed its name in 2016 and was able to reach a market value of more than $800 million. This would have been perfectly normal except for the fact that UBI chain has never earned any revenue and its phone number intended for regulatory filings is disconnected.
CEO Tony Liu appears to be unaffected by the trading suspension, saying:
“[The SEC’s decision is] understandable due to the recent frenzy of buying stock related to the Bitcoin phenomena.”
“We believe the general public is confusing our Blockchain technology with Bitcoin companies [even though we have been] involved in Blockchain technology for well over two years before the Bitcoin buying frenzy took place and we plan to be in business for years after the Bitcoin buying anomaly ends.”
UBI, not the first
UBI Blockchain is not the first company that has benefited from a Blockchain-related name change. Earlier in 2018, Long Island Iced Tea witnessed its stock skyrocket in value after it changed its name to Long Blockchain. Similarly, a small company named Longfin, experienced a 13-fold value upsurge after it announced that it was acquiring a defunct cryptocurrency.