US Regulators Give Update on Crypto Crackdown ๐จ This article is 6 years old...
News โธ Regulation
US Regulators Give Update on Crypto Crackdown
2 min read
Updated: Aug. 29, 2018 at 2:53 am UTC
Photo by Aditya Vyas on Unsplash
Since the ICO fervor of 2017, regulators worldwide have increased scrutiny on emerging cryptocurrency projects and investment schemes. On Aug. 28, U.S. regulators released an update on their coordinated cryptocurrency crackdown.
NASAA Updates ‘Operation Cryptosweep’
The North American Securities Administration Association (NASAA) updated its progress on initial coin offering- (ICO) and cryptocurrency-related investment product investigations, according to a press release.
NASAA, operated by American and Canadian securities regulators, launched “Operation Cryptosweep” in May 2018 to investigate over 200 ongoing cases of ICO- and cryptocurrency-related investment products’ regulatory compliance. Since the operation’s launch, NASAA has issued 46 enforcement actions.
In the official press release, NASAA President and Alabama Securities Commission Director Joseph P. Borg stated:
“State and provincial securities regulators are committing significant regulatory resources to protect investors from financial harm involving fraudulent ICOs and cryptocurrency-related investment products and also are raising awareness among industry participants of their regulatory responsibilities.โ
Borg mentioned that many of the enforcement actions taken against ICOs involved securities fraud but also included “failure to properly register a product before it was offered to investors.”
Other common breaches in securities regulation include fraudulent marketing tactics, phishing scams and fabricated ICO projects.
ย โWhile not every ICO or cryptocurrency-related investment is a fraud, it is important for individuals and firms selling these products to be mindful that they are not doing so in a vacuum; state and provincial laws or regulations may apply, especially securities laws. Sponsors of these products should seek the advice of knowledgeable legal counsel to ensure they do not run afoul of the law.”
In the press release, NASAA urges companies to do “their own thorough due diligence” before offering cryptocurrency-related investment products or launching an ICO. NASAA states that even registered securities offerings can still be fraudulent.
โBe cautious when dealing with promoters who claim their ICO offering is exempt from securities registration but do not ask about your income, net worth or level of investing sophistication. Do your homework and contact your state or provincial securities regulator with any concerns before parting with your hard-earned moneyโafterwardย may be too late.โ
Posted In: Regulation
