Key takeaways
- GD Culture Group and Addentax Group, two Chinese-linked firms facing potential Nasdaq delisting, are investing heavily in Bitcoin and the Trump-themed $TRUMP token to stay listed on Wall Street
- Despite weak financials, both companies announced over $1 billion in crypto purchases, raising concerns about the sustainability of their strategies.
- These high-risk crypto moves come as the Trump administration pressures Chinese firms to comply with US audit standards or face delisting from American exchanges.
- The use of politically charged memecoins like $TRUMP reflects a new era of financial desperation
Two Chinese-linked companies facing the threat of getting delisted from US exchanges are making an unconventional gamble by investing heavily in Bitcoin and the Donald Trump-themed memecoin, $TRUMP. This, to some analysts, is a desperate bid to inflate their stock prices. The unusual strategy highlights mounting tensions between US financial regulators and Chinese firms listed on American bourses.
Resorting to Crypto to Avoid Nasdaq Exit
GD Culture Group, a New York-based company with operations in China and only eight employees, announced a substantial $300 million funding deal to acquire both Bitcoin and $TRUMP. The company, which reported zero revenue last year from its TikTok-based e-commerce venture, plans to use proceeds from a stock sale to an undisclosed British Virgin Islands entity for these cryptocurrency investments. Following the announcement, its Nasdaq-listed shares surged 14%.
Days later, Addentax Group, another Chinese garment maker also at risk of Nasdaq delisting, revealed similar intentions. The company is reportedly in discussions with anonymous crypto holders to acquire up to $800 million worth of Bitcoin and $TRUMP tokens. The market reacted with extreme volatility. Addentax shares initially jumped over 150% before ending the day down by 7%.
Desperate Measures Amid Regulatory Crackdown
Securities experts view these cryptocurrency-fueled announcements as last-ditch efforts to maintain access to US capital markets. “They’re likely grasping at straws to avoid being pushed off the exchange,” a Wall Street analyst commented. These maneuvers coincide with intensified scrutiny from the Trump administration on Chinese companies.
The Trump administration has recommended delisting Chinese companies from US exchanges if they fail to comply with American accounting standards. These proposals, put forth by a working group, would compel Chinese companies to delist unless regulators gain access to their audits.
Indeed, as US-China financial tensions escalate, the intersection of memecoins, celebrity branding, and regulatory pressure now defines a new landscape on Wall Street. For companies like GD Culture and Addentax, survival may increasingly depend on navigating the complex politics of Trump-era crypto capitalism rather than traditional financial fundamentals.
Read more: SEC Proposes Lighter Frameworks to Support Crypto Market Growth
