Bright Green to investigate illegal trading in shares, stock jumps 20% (update)

Cannabis producer Bright Green BGXX stock jumped 20% Friday after the company announced plans to combat suspected illegal trading of its shares.

Shares of Bright Green opened at $1.23, slipping to an early low of $1.15 before reaching a high of $1.49 at approximately 1:10 p.m. ET. The stock closed at $1.27.

Bright Green shares have been volatile since the company announced it planned to raise $500M through the US government's EB-5 investment program. The shares rocketed as much as 260% on Wednesday following the news, but then shifted gears to drop 25% on Thursday.

The stock made its market debut on May 17 through a direct listing on Nasdaq with a reference price of $8 per share, soaring over 350% during its first session. It hit a 52-week high of $58 on May 18, but plunged the next day. The stock trended downward through the ensuing months, hitting a 52-week low of $0.35 on Dec. 22.

On Friday, Bright Green said that it was reviewing trading activity in its stock for evidence of illegal short selling, which it believes caused the shares to become artificially depressed. It added that it would monitor trading patterns moving forward and may take legal action against individuals or companies it believes engaged in illegal trading activity.

Bright Green joins a growing number of companies that have announced plans to crack down on suspected illegal short selling of their shares. Other companies include Genius Group GGNS, Agriforce Growing AGRI, BriaCell Therapeutics BCTX BCT, Verb Technology VERB, Ryvyl RVYL, Helbiz (HLBZ) and SciSparc SSPRC.

On Thursday, Genius Group said that it intends to seek a dual listing on digital exchange Upstream in an effort to crack down on illegal trading. The company also plans to distribute NFT coupons to shareholders that would require identify verification to be redeemed.