The U.S. Securities and Exchange Commission approved a new rule, Nasdaq will accelerate delisting of microcap companies.

The Nasdaq Group will revise its listing rules to speed up the delisting of companies with continued deteriorating operating conditions. Previously, regulatory agencies have been focusing on the frequent intense market fluctuations and market manipulation accusations in the trading of micro-cap stocks. The U.S. Securities and Exchange Commission approved a new rule on Wednesday: if the market value of the listed securities of a Nasdaq-listed company stays below $5 million for consecutive 30 days, the company's stock will be immediately suspended from trading and the delisting process will be initiated, with a significantly narrowed appeal process. These stricter listing standards are expected to have a comprehensive impact on the micro-cap and low-priced penny stock markets. Regulatory agencies have previously warned that this market is filled with securities fraud involving "pump and dump" schemes using digital means. The U.S. Securities and Exchange Commission stated in the announcement that low market value, low-priced stocks are more susceptible to manipulation and intense trading fluctuations, and illegal elements can easily influence their stock prices with minimal funds. The operator of the exchange proposed this new rule in January of this year, with support from mainstream institutions on Wall Street such as Castle Securities, Jiaxin Wealth Management, and the U.S. Securities Industry and Financial Markets Association; however, small and medium-sized listed companies, as well as related lawyers and industry consultants, strongly oppose it. Most opponents believe that this new rule aimed at curbing violations will harm compliant startup companies. Mark Indalia, chairman of the Small Public Company Alliance, stated: "This rule will deal a heavy blow to small and medium-sized enterprises, hinder their financing, and also give rise to negative speculative motives for shorting small listed companies. This goes against the current core direction of the commission to 'revitalize the IPO market and expand corporate financing channels'." Data shows that currently there are nearly 180 Nasdaq-listed companies with a total market value of less than $5 million, just hitting the regulatory red line set by the new rule.