U.S. regulators are investigating stock price movements of companies before announcing plans to buy cryptocurrency for signs of insider trading and disclosure violations, according to a report by the Wall Street Journal. The SEC and FINRA contacted over 200 companies with crypto-treasury strategies this year, warning about possible breaches of rules.

The SEC has filed lawsuits against major cryptocurrency exchanges Binance and Coinbase, reigniting tensions between the government and the volatile industry. The lawsuits highlight ongoing issues in an industry plagued by scandals and market meltdowns, raising concerns about regulatory oversight and compliance with securities laws.

SEC officials have cautioned companies about potential violations of rules against selective sharing of material nonpublic information. The SEC has chosen not to comment on the matter, while FINRA has yet to respond to requests for comment. Reuters has not been able to independently verify the report.

Publicly listed companies are increasingly investing in cryptocurrency, following the lead of successful companies like MicroStrategy, now known as Strategy, which began accumulating bitcoin in 2020. The trend of companies buying cryptocurrency is gaining momentum as more seek to replicate the success of early adopters.

Read more at Yahoo Finance: US regulators probe stock moves before companies made crypto-treasury announcements, WSJ reports