Clampdown on Fraudulent ICOs

US Regulator Issues Cease And Desist Order Against Fraudulent ICOs

Initial Coin Offerings, the often defamed innovative form of raising capital up in the world of cryptocurrency is standing out as truly newsworthy again for all the wrong reasons. On October 11th, it was declared that North Dakota Securities Commissioner ‘Karen Tyler’ had clamped down on three firms which were reported to offer unregistered as well as fraudulent securities under the pretense of an initial coin offering. The companies recorded in the report include Life Cross Coin, Advertiza Holdings (Pty) Ltd. and Crystal Token.

While Initial Coin Offerings have turned into a disagreeable point for the cryptocurrency industry over the last year, it’s evident that absence regulation in the space, joined with the enormous measure of money raised all through 2017 and 2018, has figured out how to pull in frauds and other terrible actors. Prior in the year, EWN provided details regarding the epidemic levels of ICOs in 2018 being classified as scams. While more up to date reports have discovered a general decline in the ICO market, the measure of capital filling the space has kept on making for an appealing proposition to developers hoping to capitalize on the present buzz around cryptocurrency as well as blockchain.

Maybe in response to the clear fraud being operated by means of ICOs and the serious absence of regulation, Commissioner tyler said something with her opinion on the Wild West nature of the investment world. She said –

“The continued exploitation of the cryptocurrency ecosystem by financial criminals is a significant threat to Main Street investors. In formulaic fashion, financial criminals are cashing in on the hype and excitement around blockchain, crypto assets, and ICOs – investors should be exceedingly cautious when considering a related investment.”

In spite of the new stories reporting on the fraudulent activities of ICOs and crypto-con artists, the initial coin offering model has given a road to innovation and quick capital to support the meteoric ascent of blockchain as well as cryptocurrency- a component that needs not to be underestimated.