Key Takeaway: US regulators, led by the SEC and FINRA, are probing suspicious trading ahead of $100B corporate crypto-treasury announcements in 2025. The investigation spans 200+ firms, targeting insider trading and Reg FD violations. High-profile cases and unusual patterns highlight risks, signaling stricter oversight, potential enforcement, and reshaping corporate disclosure and market practices.
Major Investigation Unfolds
The Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA) have launched a comprehensive investigation into suspicious trading patterns affecting more than 200 companies that announced cryptocurrency treasury strategies in 2025. The probe centers on sharp stock price movements and unusually high trading volumes that occurred days before public disclosures of crypto purchase plans.
According to sources familiar with the matter, regulators have sent inquiry letters to firms whose shares experienced dramatic price increases ahead of their crypto-treasury announcements. These preliminary inquiries represent the first step in what legal experts describe as potentially serious insider trading investigations that could result in enforcement actions.
“When those go out, it really stirs the pot,” said David Chase, a former SEC enforcement lawyer who now defends clients in regulatory cases. “It’s typically the first step in an investigation. Whether it goes full, full length, it’s anybody’s guess”.
Scale of Regulatory Scrutiny
The investigation affects a significant portion of the crypto-treasury market, which has seen explosive growth throughout 2025. Companies collectively announced plans to raise over $100 billion for cryptocurrency purchases, with most following the strategy pioneered by MicroStrategy (now rebranded as Strategy). The trend accelerated after the Trump administration’s executive order establishing a national strategic Bitcoin reserve.
Regulators are specifically examining potential violations of Regulation Fair Disclosure (Reg FD), which prohibits companies from selectively sharing material, nonpublic information with certain investors before making it public. The SEC has warned companies that such practices could constitute serious breaches of federal securities law, potentially leading to market manipulation charges.
FINRA’s involvement adds another layer of complexity, as the organization typically focuses on broker-dealer communications and trading patterns. Legal experts note that FINRA inquiry letters often precede broader investigations into trading misconduct, suggesting authorities are building comprehensive cases.
Suspicious Trading Patterns Emerge
High-Profile Cases Under Review
Several prominent examples have drawn regulatory attention. Trump Media and Technology Group experienced a 433% intraday surge in May 2025, just days before announcing a $2.5 billion Bitcoin treasury strategy. Similarly, GameStop’s shares jumped 40% in the three trading sessions preceding its disclosure of a $500 million Bitcoin purchase.
Biotech firm MEI Pharma also faced scrutiny after its stock nearly doubled within four days before revealing plans to allocate a quarter of its cash reserves to Litecoin. The company’s announcement coincided with unusual call option activity, further raising regulatory concerns.
Market Impact and Investigation Focus
The investigation encompasses firms across diverse sectors, including software, gaming, biotech, and energy companies. Regulators detected patterns of clustered buy orders and broker communications that preceded official announcements, suggesting potential information leaks.
"These unusual patterns triggered inquiries into whether sensitive details leaked before announcements," according to regulatory sources. The agencies are collecting trading data, communications records, and market activity to determine whether violations occurred.
Regulatory Response and Market Implications
Warning Signals to Corporate America
The SEC has explicitly warned companies about potential breaches of disclosure rules, emphasizing that selective sharing of material information with certain investors constitutes a federal securities law violation. This represents a significant escalation in regulatory oversight of the crypto-treasury trend.
Officials are particularly concerned about market integrity and fairness, especially given the volatile nature of cryptocurrency-related announcements. The investigation signals that traditional securities regulations apply fully to companies adopting crypto strategies, regardless of their previous business focus.
Industry Response and Skepticism
The regulatory scrutiny has coincided with growing market skepticism about crypto-treasury strategies. Some companies now find their crypto holdings valued higher than their actual stock market capitalizations, leading to debt-funded share buybacks and strategic reassessments.
ETF specialist Nate Geraci expressed shock at the alleged insider trading, suggesting that upcoming crypto ETF approvals could diminish the appeal of crypto-treasury companies: “Think it’s pretty much game over now, especially once staking in ETFs is approved”.
Historical Context and Precedent
MicroStrategy Effect
The crypto-treasury trend originated with MicroStrategy’s pioneering Bitcoin strategy in August 2020. Under Michael Saylor’s leadership, the company accumulated over 630,000 BTC, transforming from a traditional software firm into the world’s largest corporate Bitcoin holder.
This success created what industry observers call the “MicroStrategy Effect,” inspiring hundreds of companies to adopt similar strategies. However, the current investigation represents the first major regulatory challenge to this corporate trend.
Corporate Crypto Adoption Data
Current data from Bitcoin Treasuries shows that 194 public companies now hold more than 1 million BTC, valued at approximately $113 billion. Additionally, 69 organizations hold 5.26 million ETH worth about $20.6 billion, while nine entities control over 13.4 million SOL representing $2.6 billion.
Looking Ahead
Potential Enforcement Actions
While no formal enforcement actions have been announced, the scope and intensity of the investigation suggest significant regulatory consequences may follow. Companies face potential penalties ranging from fines to more serious legal action if violations are confirmed.
The investigation also highlights broader challenges in regulating the intersection of traditional securities markets with cryptocurrency volatility. Firms may need to implement stricter internal controls and delay announcements to avoid regulatory scrutiny.
Market Evolution
Legal experts predict the investigation could reshape corporate disclosure practices and slow the momentum of crypto-treasury adoption. The regulatory focus on pre-announcement volatility underscores ongoing challenges in balancing financial innovation with compliance requirements in the cryptocurrency space.
Source: Based on reports from The Wall Street Journal, Reuters, and other financial news publications