Wow. It is a solemn day for cryptocurrencies everywhere! According to CoinMarketCap, the market is experiencing a big crash with most coins seeing double-digit losses. I wish I could be bringing a lighter tone to this grey picture, but another fraudulent ICO has been shut down by the SEC earlier today.
Is such market volatility going to spell the end for cryptocurrency? Between vast and sudden sell-offs and another fraudulent ICO, you begin to understand why so many bears populate this sector. What’s going on?
Another Fraudulent ICO
Earlier today, the US Securities and Exchange Commission (SEC) reported that it had halted a planned Initial Coin Offering (ICO). This fraudulent ICO had claimed it had regulatory approval, including approval from the SEC itself.
The company Blockvest LLC, and its founder Reginald Buddy Ringgold III (a fake name I suspect) was issued a subpoena and ordered to cease the ICO project and any pre-ICO sales.
Blockvest falsely claimed that its ICO and relative affiliates had received approval from major financial regulators. It claimed the project was “licensed and regulated.”
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Blockvest brazenly impersonated the SEC seal and ran an ICO that it promoted via a fake agency called the ‘Blockchain Exchange Commission.’ The ‘Commission’ also used a fake SEC seal, as well as the SEC address. In doing this, Ringgold broke the federal law.
Following the SEC’s complaint, the US District Court for the Southern District of California has frozen any funds relative to the fraudulent ICO. The case is set to be heard on October 18th.
Fraudulent ICOs have been a massive industry problem for cryptocurrency. The SEC has continually launched campaigns to help investors avoid any potential fake scheme. Earlier this year it launched its own fake ICO website to raise awareness on the issue. It also launched its ‘Operation Crypto Sweep’ whereby it sent out over 70 cease and desist letters to what was believed to be fraudulent ICOs.
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