Market manipulation? Khaby Lame’s net worth soars to ₹60,510 crore after historic deal; then, stock crashes 77%

Khaby Lame, famous for her silent videos that overcome language and cultural barriers, won a gold medal. On January 11, Rich Sparkle Holdings acquired $975 million (almost ₹9,000 crore) deal has been struck to acquire Step Distinctive Limited, founded by the TikTok star. Rich Sparkle is a Hong Kong-based company listed in the US.

The transaction was first reported to the U.S. Securities and Exchange Commission (SEC) on January 9. This acquisition marks a shift from short-term brand partnerships to a structured, platform-focused business model.

Also Read | TikTok user Khaby Lame sells part of Step Distinctive to Rich Sparkle for $975 million

The deal also includes making an AI version of Khaby Lame using her face, voice and style. This digital edition will create content in multiple languages. It will work across different time zones and help it reach more people at the same time.

Lame owned 49% of Step Distinctive Limited before the sale, according to SEC filings. Now Rich Sparkle is reportedly the controlling shareholder.

“This is not just an equity acquisition, but a revolution in the global content e-commerce model. We will perfectly combine Khaby Lame’s global impact with ‘industrial e-commerce operational capabilities,'” Rich Sparkle said in a statement.

Khaby Lame has approximately 360 million followers worldwide. Rich Sparkle sees Khaby as a rare creator who can create value in markets around the world because he is not dependent on language.

Also Read | Who is Khaby Lame? The most viral TikTok star is leaving the US — A look at her best videos

Immediately following news of the deal, Rich Sparkle’s share price jumped more than 650%, reaching $180.64 on January 15.

According to Forbes, Khaby Lame’s net worth on paper increased by $6.6 billion ( ₹60,510 crore) due to increase in stock prices. The calculation was based on his indirect stake in the company. But it’s unclear whether he sold shares when prices hit all-time highs because of limited disclosure rules for foreign companies.

Then Rich Sparkle’s share price fell 77%. As of January 31, the stock is trading at $83.00. However, it is still well above its pre-deal price of around $24.

Rich Sparkle was listed on Nasdaq just six months ago, in July. He raised money by selling 1.25 million shares at $4 each. 2024 revenue was less than $6 million.

‘red flag’

The company’s sudden change of direction, sharp rise and steep decline to around $41 raised “red flags” among critics.

According to Jim Chanos, the deal resembles a “Chinese stock promotion.” This is a model of market manipulation in which little-known companies artificially inflate their share prices. Such companies often have ties to China.

“It all seems crazy,” Forbes quoted the founder of Chanos & Company as saying.

“I have only seen this type of chart on the pump and dump plot,” says Laura Posner of Cohen Milstein.

Lawyer Brenda Hamilton commented on Rich Sparkle’s IPO: “This is very suspicious.”

Also Read | Was Khaby Lame really arrested by ICE for living illegally in the US?

Forbes says there is uncertainty about whether the deal has been officially finalized. Rich Sparkle did not file a confirmation with the US SEC following his announcement.

Legal experts say this raises serious questions. Some believe the valuation is based largely on Lame’s TikTok popularity, raising concerns about transparency and investor risk.

“There are a lot of questions to be answered. The valuation appears to be based heavily on Khaby Lame’s following on TikTok,” attorney Ron Geffner told Forbes.

ICE action against Khaby Lame

During the tightening of immigration enforcement under President Donald Trump’s administration, Khaby Lame was detained by US immigration officials in Las Vegas on the grounds that his visa had expired.

U.S. Immigration and Customs Enforcement (ICE) confirmed in June 2025 that Lame was stopped at Harry Reid International Airport. He was later allowed to leave voluntarily without a deportation order.

Voluntary departure allows individuals to leave without a formal record of deportation. This helps them avoid long-term re-entry bans.

The Senegalese-Italian citizen entered the United States in April 2025 and overstayed his permitted visa. He did not make a public statement about the incident.