In mid-July, the stock for the cancer drug developer MEI Pharma skyrocketed. It wasn’t because the small company, first listed on the Nasdaq in 2003, had discovered a blockbuster cancer cure. Rather, MEI Pharma’s soaring share price coincided with the company’s decision to buy up $100 million of the cryptocurrency Litecoin for its treasury.
The pop in price, which saw shares go from $3 to a high of $7, wasn’t surprising. In announcing the Litecoin purchase, MEI Pharma became just the latest firm to exploit a popular stock price hack: When a public company adds crypto to its balance sheet, traders have responded by buying up shares and boosting the firm’s value well beyond the cost of the purchase.
