Recently, a shocking claim was made that the intentions of companies purchasing Ripple (XRP) and Solana (SOL) are to manipulate prices for a pump-and-dump scheme.
Matthew Sigel, the head of digital assets at VanEck, claimed that the announcements of cryptocurrency purchases by some low market cap companies listed on the Nasdaq, such as Ripple and Solana, could only be aimed at inflating prices for a pump-and-dump scheme.
As the cryptocurrency market rises, it has become fashionable for small companies to announce purchases of cryptocurrencies worth hundreds of millions of dollars. However, Matthew Sigel doubts the authenticity of these announcements. Especially the purchase announcements regarding popular altcoins like XRP and SOL raise questions in investors' minds.
Finally, Singapore-based Trident Digital Tech announced plans to raise funds to create a $500 million XRP treasury. However, the company's market cap is only at $16 million, and its shares are trading below 40 cents.
Matthew Sigel warned that a large portion of these types of announcements are suspicious transactions. He generally assesses the announcements of such ambitious purchases by these low market cap companies, made without a new major investor announcement, as pump-and-dump operations.
At the beginning of this trend, Sigel pointed out a small market-cap textile company based in China that announced plans to purchase $800 million worth of Bitcoin and TRUMP coin, warning investors without sharing the company's symbol. Similarly, the educational technology firm Classover Holdings recently announced plans to create a $500 million SOL treasury, but the company's market cap is below $100 million.
Experts state that investors should approach such announcements with caution and recommend a careful examination of whether the financial structures of the companies align with their statements.
Stay tuned for new developments.