Spokesperson Says Malicious ICOs Are Like Roaches
There’s no question about it that the recent surge in attention surrounding the cryptocurrency market has been good overall. The idea and focus on blockchain technology may have been able to open up a whole new door of opportunity for industries that would have never thought of this in the past. The next phase to this was the Initial Coin Offering or “ICO”. For the most part, these ICO’s have been able to grant companies the ability to raise money by using blockchain and cryptocurrency as the main drivers.
However, due to the unregulated nature of cryptocurrency, some companies are taking advantage of the excitement and exploiting ICO’s with malicious intent. Several publicly traded companies have come under the heavy scrutiny of the U.S. Securities and Exchange Commission (SEC). co-director Steven Peikin expressed that such sales could pose a threat to the unassuming investor who’s just dipping a toe into the space.
“As with any kind of newsworthy event, roaches kind of crawl out of the woodwork and try to scam money off of investors.”
And with countries like China already putting pressure on the market as a whole after announcing their ICO ban, it comes as no surprise that the SEC is looking to get involved in the US. The agency said that they are looking for “bad actors”. The group charged with enforcing the SEC’s wishes has put pressure on public companies involved with or said to be involved with cryptocurrency in any way.
Some of the SEC’s investigations even cite fraudulent ICOs and when there’s some $1.8 billion being raised through this method, there is surely some group looking to take advantage of it. This is the unfortunate part of having such a positive surge within the space.