Nasdaq Reprimands TON Strategy Over Toncoin and Stock Transactions

By: Eliza Bennet

Nasdaq has issued a warning to TON Strategy, formerly known as Verb Technology Company, due to significant rule violations concerning its recent cryptocurrency transactions. The reprimand pertains to a colossal $272.7 million purchase of Toncoin and a complementary private investment in public equity (PIPE) deal, both of which were executed without obtaining the necessary shareholder approval.

TON Strategy, recognized for its focus on acquiring Telegram-linked Toncoin tokens, has come under scrutiny for failing to adhere to Nasdaq's stringent regulations. The issue primarily revolves around the absence of shareholder backing for the stock issuance under the PIPE deal to facilitate the substantial Toncoin acquisition, a matter that was highlighted in an 8-K filing with the U.S. Securities and Exchange Commission.

The disciplinary measure underscores Nasdaq's commitment to maintaining transparency and adherence to market rules. While the reproach does not entail the delisting of the company's stock, it signals the necessity for corporations to adhere strictly to shareholder consent requirements when maneuvering significant asset purchases involving cryptocurrencies. This event serves as a reminder to public companies of the regulatory expectations when engaging in cryptocurrency dealings, ensuring that such transactions are executed with full compliance to safeguard investor interests.

For further insights into the implications of this reprimand on TON Strategy and the broader impact on cryptocurrency investments, companies may consult Nasdaq and SEC guidelines.