Regulators Crack Down

I just published Cryptocurrency Investor Survey. Also, apologies for not sending the newsletter yesterday, I was ill. I am still pretty ill so only one column today.


Statement on NASAA’s Announcement of Enforcement Sweep Targeting Fraudulent ICOs and Crypto-asset Investment Products

What's the story?

  • NASAA is investigating 70 different cryptocurrency cases
  • Three companies in conjunction with the State of New Jersey were issued cease and desists: Bullcoin, Trident Crypto Index Fund, and Springcryptoinvest
  • The chosen companies blatantly violated securities law, and there is still no indication of future ICO regulations

Why Does This Matter?

This investigation is one of the biggest crackdowns on ICOs, if not the biggest one. The investigation comes on the heels of the SEC's fake ICO site called Howeycoin. One defendant, ShipChain, blatantly disregarded security laws by selling tokens in the United States and with no apparent value besides the purpose of holding the token for a profit. If it was a utility token (which isn't a legal word), it would be unclear if regulators still would've pursued them. I perused some of the cases and they, for the most part, blatantly disregard security laws. There were examples of token offerings that listed fake endorsements and/or phony team members. Others promised guaranteed returns such as 4% daily interest. None of these sweeps are groundbreaking. They aren't taking down ICO offerings that were in grey areas but rather were entirely in the black (illegal).