Regulators probe pre-disclosure trading around crypto treasuries

U.S. securities regulators have opened preliminary inquiries into unusual stock trading that occurred in the days before public announcements by more than 200 companies this year that said they would build cryptocurrency treasuries, according to people familiar with the matter. The Securities and Exchange Commission and the Financial Industry Regulatory Authority have contacted a subset of those firms after detecting sharp price gains and unusually heavy trading volume ahead of their disclosures, the sources said. The SEC declined to comment, and FINRA did not respond to requests for comment.

The outreach appears to be aimed at determining whether selective leaks of material nonpublic information or trading on that information occurred, potentially violating Regulation Fair Disclosure and insider trading laws. Officials flagged stock movements that in some cases accelerated during the days or weeks before companies publicly announced plans to raise cash and buy digital assets, the people said. No enforcement actions have been announced.

Regulation Fair Disclosure, or Reg FD, bars companies from sharing material information with select investors before making it public. Andrew...