Khaby Lame’s $975 Million Deal Hits Snag as Brokerages Restrict Trading

Several prominent investment platforms have restricted or blocked the trading of shares in Rich Sparkle Holdings following a volatile $975 million deal involving TikTok creator Khaby Lame. The restrictions come as the company’s stock has plunged more than 90% from its January 2026 high, amid growing uncertainty over whether the transaction was ever finalized.

Interactive Brokers has listed the stock as non-tradable. A spokesperson for the firm stated that the company periodically reviews the securities it makes available for its clients to trade and restricts those it has determined are not appropriate to offer.

Other platforms that have blocked online trading or placed restrictions on the stock include Fidelity, Charles Schwab, Vanguard, ETrade, and Merrill Lynch. Trading remains available as normal on platforms such as Webull and Robinhood.

As of the close of business on April 8, 2026, Rich Sparkle Holdings had a market capitalization of approximately $133 million. James Angel, a finance professor and FINRA program director at Georgetown University, noted that brokers often limit trading in low market-cap stocks to avoid logistical complications if the companies disappear.

Structure of the All-Stock Transaction

The deal involved the acquisition of Step Distinctive Limited, the company that manages Khaby Lame’s brand and commercial activities, by the Nasdaq-listed Rich Sparkle Holdings. While the deal was valued at approximately $975 million, it was structured as an all-stock transaction, meaning no cash changed hands.

Under the terms of the agreement, Lame became a controlling shareholder in the acquiring entity. This structure ties the creator’s future earnings to the corporate performance of the entity rather than providing an upfront liquid payout. The acquisition includes access to Lame’s brand endorsements, ad productions, TikTok Shop, and short-video and livestream commerce.

A central component of the deal is the commercial development of an AI digital twin. This AI avatar is authorized to use Lame’s voice, image, and behavior to generate original, multi-version content in multiple languages. Rich Sparkle Holdings stated that this partnership is expected to generate $4 billion in annual sales.

Market Volatility and Valuation Concerns

The announcement of the deal in January 2026 triggered a rapid increase in Rich Sparkle’s stock price, which surged more than 650% and briefly exceeded $180 per share. This spike created a multibillion-dollar paper valuation for Lame’s stake. However, financial experts have questioned the legitimacy of this valuation, noting that the firm has a very small number of publicly traded shares.

Rich Sparkle Holdings went public in the summer of 2025 with a modest Nasdaq offering of just over one million shares at $4 each, implying a company valuation of approximately $50 million at that time. The subsequent rapid rise and crash of the stock price have led to accusations of a pump-and-dump scheme.

Contradictory Filings and Operational Control

Questions regarding the status of the deal have mounted due to conflicting information provided by Rich Sparkle Holdings. While a January 2026 press release described the acquisition as completed, a U.S. Securities and Exchange Commission (SEC) filing dated March 31, 2026, described the deal as contingent on certain conditions.

a January 2026 filing indicated that the deal would be void if specific conditions were not met or waived by February 28, 2026. There have been no formal filings confirming that Lame’s company received the promised 75 million shares.

Operational control of the brand does not reside with Rich Sparkle Holdings. Instead, a Chinese multi-channel network, Anhui Xiaoheiyang Network Technology Co., has secured exclusive global full-chain operating rights over the Khaby Lame brand under a three-year strategic cooperation agreement. This grants the Chinese firm broad control over the distribution, licensing, and monetization of Lame’s identity and content worldwide.

Creator Background and Current Status

Khaby Lame, a Senegalese-Italian influencer with over 160 million followers on TikTok, rose to prominence in 2020 after being laid off from a factory machine labor job. He is known for dialogue-free videos that mock overly complicated life hacks.

Lame’s business activities have faced external disruptions. In June 2025, he left the United States after being detained by U.S. Immigration and Customs Enforcement at Harry Reid International Airport for overstaying the terms of his visa.

Since expressing excitement about becoming a shareholder in January 2026, Lame has not spoken publicly about the deal. He has removed the stock ticker ANPA from his TikTok and Instagram biographies. His representatives and Rich Sparkle Holdings have not responded to requests for comment.