Since mid-2017, bitcoin has rocketed from $2,500 to over $16,000 today. A lot of companies associated with bitcoin and other digital cryptocurrencies are getting caught up in the investment mania, even as it becomes clear that bitcoin's house is built on sand.

Among other things, this is turning a lot of investors into potential marks for a new breed of financial hucksterism.

Take the recent case of The Crypto Company.

A young Malibu-based company that incorporated this past March, then went public in June, Crypto is largely a consulting firm: It helps people invest in bitcoin and other currencies, develop systems and software for managing those investments, and get "exposure to the growth of global blockchain developments." The company says it has made $564 million trading cryptocurrencies just since March, and that it's planning to build "a full scale, high frequency cryptocurrency trading floor."

Crypto stock is traded in over-the-counter markets, and it's been surfing the bitcoin wave: The company's shares jumped 1,800 percent in just the last month — and 17,000 percent over the last three months. That lifted the company's total market capitalization to $12.6 billion, which is more than Macy's or The New York Times.

The Securities and Exchange Commission (SEC) also decided it was somewhat fishy. On Tuesday, the regulatory agency temporarily suspended trading in Crypto's stock.

The SEC has "concerns regarding the accuracy and adequacy of information in the marketplace about, among other things, the compensation paid for promotion of the company, and statements in commission filings about the plans of the company's insiders to sell their shares of The Crypto Company's common stock," it wrote in a statement.

"Questions have also arisen concerning potentially manipulative transactions in the company's stock in November 2017."

Basically, it sounds like the SEC is worried that Crypto is bilking or manipulating its investors — and that the company's insiders are planning to sell off and nab a big payday before the share price collapses.

The suspension ends on midnight, Jan. 3. So this isn't proof of wrongdoing so much as it is a shot across the bow — both for Crypto currency and anyone who might trade with them. No response from Crypto has appeared yet, though the company said one is forthcoming.

But there's definitely a lot about Crypto that looks odd.

It actually swallowed up a "fitness apparel" company (mainly sports bras) in the course of going public this year. According to his LinkedIn profile, Crypto CEO Michael Poutre has run a jewelry company, a hedge fund, a mobile-app search firm, and more, just in the last decade. Due to his one-fifth stake in the company, Crypto's massive market capitalization boom has made him a billionaire — at least in terms of the value of the current shares he owns. Poutre has also butted heads with the Financial Industry Regulatory Authority, though he's never confessed to any wrongdoing.

More fundamentally, it's just not clear what value Crypto is adding to the economy. Get past its jargon-heavy self-description, and its entire business model seems to revolve around helping people trade bitcoins and other cryptocurrencies. The value of its service — and thus its revenues — depends entirely on the value of those currencies remaining high.

Of course, if bitcoin is in a massive bubble (which seems blatantly obvious at this point), it will inevitably pop. And when it does, it will take the business models of companies like Crypto — and its stock value — down with it.

Maybe Crypto's owners are knowing and cynical, or maybe they're just as naively enthusiastic as everyone else. But either way, investors in Crypto's shares are basically flushing their money away. It will just be a question of who cashes out before the bubble pops, and who cashes out afterwards.

Nor is Cypto the only instance of this. Other financial and tech companies are jumping into the cryptocurrency business, and seeing their stock prices skyrocket as a result.

What smart investors should always ask is this: What real world value does the company I'm investing in actually produce? And can it continue doing so over the long term?

Bitcoin or any other cryptocurrency doesn't really fit the bill. There actually isn't a great demand or need out in the world for an anarchic digital currency that operates outside the centralized oversight and policy management of major Western governments. As a currency, it provides no real benefit that digital payment services for existing national currencies don't already provide. And since no one uses bitcoins for anything concrete (the way, say, gold is used in electronics or jewelry), it's not a stable store of value either. The only thing propping up bitcoin is excitement over owning bitcoins.

Now, what could be of real long-term value to the world is the blockchain software technology that powers bitcoin. Applications include reducing the time it takes financial transactions to clear and settle, and improving the privacy of those transactions. But in that case, what to look for isn't companies that trade in cryptocurrencies or consult in cryptocurrencies or have "bitcoin" or "cryptocurrency" or whatever in their name. Instead, look for companies actually trying to develop and deploy blockchain technology.

For the most part, those companies are big, boring, and established financial players: Think JPMorgan Chase, Goldman Sachs, Citi, and such. Or they're smaller startups that are partnering with those big, boring, established players. And for the most part, they're going to be putting that blockchain technology towards improving trade in established currencies.

It's not super sexy. But if you're an investor who's excited or intrigued by bitcoin — and you want to avoid getting burned or swindled — that's probably where you should put your money.