Smart Digital Group Plummets 87% Following Crypto Strategy Shift

Smart Digital Group's stock just cratered—down a staggering 87%—after announcing its pivot into cryptocurrency markets.

The Market's Verdict

Investors delivered a brutal verdict on the company's crypto ambitions. The selloff erased nearly all shareholder value in a single trading session.

Strategy Backlash

The dramatic plunge highlights Wall Street's skepticism about traditional firms jumping into digital assets. Turns out slapping 'crypto' on your business plan doesn't automatically print money—who knew?

Another case of corporate crypto FOMO meeting cold, hard market reality.

A pivot that defied the playbook

The dramatic collapse of Smart Digital Group’s valuation stands in stark contrast to the market’s typical reaction to such announcements. According to a 2025 Animoca Brands report, companies announcing corporate crypto-treasury strategies have surged an average of 150% within 24 hours of disclosure. This pattern has played out repeatedly in recent months.

Brera Holdings, a small European soccer club investor, saw its stock skyrocket as much as 464% after revealing its plan to rebrand as Solmate and transition to a Solana-based digital asset treasury, a move backed by a $300 million private placement from names like ARK Invest and the Solana Foundation. Similarly, Chinese EV technology firm Juizi Holdings enjoyed a 25% stock bump following its authorization of a $1 billion Bitcoin treasury initiative.

The critical difference lies in the details markets are now scrutinizing. Companies rewarded by investors have presented clear funding mechanisms, high-profile backers, and specific operational roadmaps.

Smart Digital’s announcement, by comparison, lacked concrete details on the size of the planned asset pool, its funding source, or any strategic partnerships. This vagueness, coupled with the absence of a clear, crypto-native business synergy, transformed a potential growth narrative into a red flag for shareholders concerned about uncalculated risk and diluted corporate focus.

Regulators take note of crypto treasury companies

This escalating trend has not gone unnoticed by regulators. The Securities and Exchange Commission and the Financial Industry Regulatory Authority have reportedly initiated a broad probe into trading activity surrounding more than 200 companies that have announced crypto-treasury plans, according to WSJ.

The core of the investigation revolves around suspicious stock-price increases in the days preceding public announcements, a potential sign of selective disclosure or insider trading that WOULD violate Regulation Fair Disclosure.

While Smart Digital’s pre-announcement trading involved a plunge rather than a gain, the intense regulatory spotlight adds a layer of systemic risk to any public company making a crypto pivot, potentially spooking institutional investors.