This morning the SEC issued a trading suspension for the shares of Evolution Blockchain Group Inc (EVBC).
SEC trading suspension release (PDF)
SEC trading suspension order (PDF)
The reasons given for the trading suspension (emphasis mine):
The Commission temporarily suspended trading in the securities of EVBC because of (1) questions about the accuracy and adequacy of information in the marketplace since at least May 17, 2018, including the accuracy of information contained in an Evolution Blockchain press release dated May 17, 2018, referencing a whitepaper, and (2) concerns since at least May 15, 2018, about recent unusual and unexplained market activity in the company’s common stock. Evolution Blockchain is a Nevada corporation whose stock is quoted on OTC Link LLC (previously Pink Sheets), operated by OTC Markets Group, Inc., under the ticker symbol EVBC.
The Commission acknowledges FINRA’s assistance in this matter.
The press release from May 17th, 2018 is copied below in full:
Evolution Blockchain Group – Announces Two Acquisitions and Corporate Updates
Las Vegas, Nevada (FSCwire) – Evolution Blockchain Group Inc. (OTC: EVBC) (“Evolution” or the “Company”) is pleased to announce that it has acquired two new blockchain technologies, Drive-coin and Gamebitcoin.
Drive-coin
Drive-coin is a peer-to-peer blockchain solution for the automotive and parts industry. It is in development and when completed will allow for peer-to-peer vehicle and parts sales using a blockchain inventory management system designed with the use of smart contracts. It will also have a social networking component with many features to localize sales of the vehicles and parts. The technology will support automotive financing options integrated with traditional lenders to facilitate the purchasing or leasing of vehicles with Drive-Coin.
Gamebitcoin
Gamebitcoin is a game specific blockchain development solution tailored to gaming transactions across the globe. Currently a prototype token, Gamebitcoin will be built out on our own unique blockchain with various unique features that will allow for multiple revenue streams. Gamebitcoin will be an open platform where software and game developers can connect to API’s and integrate their game to the Gamebitcoin. Fees are transaction based granting new developers easier access to revenue at a lower cost.
EBG Blockchain Prototype
Our whitepaper outlines a unique and proprietary blockchain technology system that improves on current blockchain methodology by improving the user experience, enhancing user asset protections, improving security methodologies and implementing unique and proprietary features. Extensive auditing of the blockchain will occur before release.
Management Additions
Evolution would like to welcome two new officers to the company, Thom Richardson as Vice President of Technology and Dominic dos Santos as Head of Project Management for Gamebitcoin. Mr. Richardson has over six years of experience as a software engineer focused in the area of agile development. He comes from a strong data-driven background and got his start at Fidelity Investments. After graduation, Thom Richardson obtained his degree in Economics from the University of Texas at Arlington. Prior to Evolution, Mr. Richardson has spent the last 5 years managing software teams from all corners of the world building applications and APIs using the MEAN stack , an open-source JavaScript software stack for building dynamic websites and web related applications. Mr. Santos is a young entrepreneur and business owner of a private web development and server hosting company. Educated at Sheridan College and then Concordia University, Mr. Santos is an expert in Windows and Linux software.
New Website
In addition, Evolution has launched its new website: www.evolutionblockchain.com.
“Drive-Coin is an exciting blockchain technology that we are developing and looking to forward to launching,” says Lawrence Stephenson, President of Evolution, “This blockchain technology will eventually be coupled with a compliant initial coin offering (ICO). Prior to launching the Drive-Coin or the Gamebitcoin ICOs, we will be consulting with the Securities and Exchange Commission (SEC), the CSE and our legal team to determine if our Drive-Coin tokens are considered securities as defined by the SEC or token assets and will take the necessary avenues to ICO,” adds Lawrence Stephenson, “It is very important to us that we adhere to the laws and approach this new and exciting financial technology within the guidelines of regulation. We are very pleased to welcome Thom and Dominic to the team, as they will be instrumental in managing the development and launch of our technologies.”
About Evolution Blockchain Group
Evolution Blockchain Group is focused on acquiring, developing and launching globally scalable blockchain technology solutions, as well as building cryptocurrency mining operations. Initial product launches will utilize smart contracts and showcase our products core features. EBG is committed to becoming a significant contributor in the evolution of blockchain technology that yields long term value for its shareholders and the global community by providing engineering, development, capital and expertise to our own proprietary blockchain core projects – projects that we will license and generate royalties from. Our unique technologies improve on various aspects of current blockchain developments and focus on producing revenue driven results. Evolution has entered a new and exciting field of technology, a field that is changing the way businesses and people interact.
Contact Info
Lawrence Stephenson
lstephenson@evolutionblockchain.com
Perhaps more interesting than the press release is the SEC mention of the trading of the stock, which doubled before losing almost all its gains and closing close to the opening price on May 15th (the date mentioned in the SEC press release). The volume on that day was only about 35,000 shares and I cannot remember the last time the SEC mentioned unusual trading activity in a suspension press release in a stock that was trading so little volume. The SEC also mentioned the assistance of FINRA so perhaps SARs (suspicious activity reports) filed by brokers found evidence of wash trading. The somewhat increased volume and fairly tight trading range after May 15th does lead me to believe that there may have been wash trading going on in the stock to prepare it for a stock promotion.
EVBC will resume trading on the grey market (no market makers) at the open on Wednesday, July 11th.
EVBC previously traded as Garmatex Technologies (GRMX) and was reported by Promotion Stock Secrets to be a boiler room / email pump by StockCallers. The ticker and name were changed on March 27, 2018. Promotion Stock Secrets also reported that there had been some phone calls promoting the stock over the last month.
Below is the chart from when GRMX was promoted from March through early May of 2017:
Disclaimer. No position in any stocks mentioned and I have no relationship with anyone mentioned in this post except that I have subscribed to Promotion Stock Secrets for the last few years. This blog has a terms of use that is incorporated by reference into this post; you can find all my disclaimers and disclosures there as well.