INSUBCONTINENT EXCLUSIVE:
From Howeycoin to a Chinese study that found 421 fake token sales, governments and researchers are finally shedding light on bad actors in
the token sale space.
Take, for example, Operation Cryptosweep
According to an North American Securities Administrator Association, regulators in the US and Canada are looking into 70 token sales and may
be taking action against as many as 35
They write:
NASAA members from more than 40 jurisdictions throughout North America participated in &Operation Cryptosweep,& which to date
has resulted in nearly 70 inquiries and investigations and 35 pending or completed enforcement actions related to ICOs or cryptocurrencies
since the beginning of May
NASAA members are conducting additional investigations into potentially fraudulent conduct that may result in additional enforcement actions
These actions are in addition to more than a dozen enforcement actions previously undertaken by NASAA members regarding these types of
Many NASAA members also are conducting public outreach initiatives to warn investors in their jurisdictions of the risks associated with
ICOs and cryptocurrencies.
&The persistently expanding exploitation of the crypto ecosystem by fraudsters is a significant threat to Main
Street investors in the United States and Canada, and NASAA members are committed to combating this threat,& said NASAA President, Joseph P
&Despite a series of public warnings from securities regulators at all levels of government, cryptocriminals need to know that state and
provincial securities regulators are taking swift and effective action to protect investors from their schemes and scams.&
Further,
regulators in China have compiled a page detailing scams including products that are clearly pyramid schemes featuring &dynamic (rewards in
proportion to money invested)& and &static (fixed)& incentives
After all, anything that claims to offer regular returns is probably suspect.
Other scams include over-the-counter tokens & OTC & that are
only available from a certain site and are difficult to trade
Any token without a sufficient & and difficult-to-build & market is ripe for abuse.
Ultimately, crooks follow money
The Washington Post found hundreds of ICOs that featured spurious teams and claims including one site that featured Prince Charles and
Jennifer Aniston & under fake names & as members of the advisory board.
What the bottom line There is not nearly enough oversight and far
too much fun being had at the expense of the uneducated investor
The financial equivalent of script kiddies are breaking the markets that others are taking time and money to create and there is little
Ultimately, this does little more than damage the perception of ICOs and hurts folks who are trying to legitimately use the techniques to
raise cash and build projects
It is, in short, as messy as the early Internet with no fix in sight.
