After Raising $100M During ICO “Gold-Backed” Karatbars Are Being Investigated By Florida Regulators
A German-based company is currently being investigated by the financial regulators of Florida. Karatbars International had an Initial Coin Offering (ICO) back in 2018 and it raised $100 million to create its own gold-backed token.
Now, the regulators are investigating the company and its KaratGold Coin (KBC), which is said to be connected to a crypto bank in Miami. The issues started when the local regulators affirmed that the company is not licensed to operate in the state and that their claim is possibly fake.
Katie Norris, the director of the Florida Office of Financial Regulation, affirmed that the investigation is still underway but that the company did not seem to have any kind of bank in the state at all.
This is not even the first time that regulators are looking into the company, which was originally founded in 2011 by the German entrepreneur Harald Seiz. Back in 2014, Canadian regulators told investors that they should be cautious when buying gold with the company. Regulators from Namibia and the Netherlands followed a similar path and warned investors, too.
Curiously, the KBC tokens are traded in over 30 exchanges, including in some big ones such as HitBTC. It was also promoted by the controversial John McAfee before and was able to raise $100 million during the ICO craze.
Is this a huge scam or only a legitimate investment that seems to exaggerate a bit? It is still early to tell for sure, as the regulators have not closed their investigation yet, but it is certain that this is the kind of investment that you should be wary about.