Securities Association Cracks Down On Cryptocurrency Scams
The NASAA, or the North American Securities Administrators Association has come forward with information regarding an orchestrated, global attack on cryptocurrency scams which continue to minimize public trust in the market. In particular, the organization has worked to take down hundreds of ICO, or Initial Coin Offering, scams.
The NASAA is a North American organization comprised of hundreds of jurisdictions all over the continent, including some major names in the regulating sector within the United States. The organization is loosely-based and is not grounded in a legitimate power like, for example, the SEC, but it has been incredibly effective at conducting probes into problematic businesses in the financial sector.
The recent crack-down makes sense, given the current efforts of the Securities and Exchange Commission of the United States to classify cryptocurrencies as securities, a move that would spell trouble for the thousands of cryptocurrency-based companies reliant on crowdfunding efforts known as ICOs.
Scope Of Investigation
The operation, known as “Operation Cryptosweep,” targeted companies rooted in over 40 jurisdictions, issuing over 70 inquiries and investigations, as well as 35 inquiries currently in the enforcement or completion phase of their investigation.
This isn’t the beginning of NASAA interest in cryptocurrency regulation, either. Dozens of enforcement attempts on supposed violators of securities regulations have occurred this year within the association. This latest operation is an extension of previous efforts to target the increasing prevalence of scams on the blockchain.
The investigatory efforts have also revealed a new plethora of information regarding the exact extent of the financial sector surrounding cryptocurrency and ICOs. According to sources, over 30,000 cryptocurrency-related websites are currently in operation.
Even more concerning to some officials, most of these domains are relatively new, having been created within the past two year. Many professionals warn that the new nature of this industry is cause of both concern and skepticism, especially for those investors who are considering pouring their funds into ICOs that promise significant profits for early investors.
Enforcement Efforts Incoming
A full list of the companies being issued various legal documents regarding compliance can be found on the NASAA website. Several notable crytptocurrency companies, both respected and not respected, can be found among their ranks. This marks a significant movement within the cryptocurrency regulation world, because it shows that the SEC is no longer the sole entity working to regulate cryptocurrencies as securities.
President Borg of the NASAA remarked that the recent enforcement and investigatory actions are only the “tip of the iceberg,” pointing to the vast array of business springing up all over North America that take advantage of the blockchain. NASAA definitely has a tough job ahead of them; hundreds of scams have taken millions from investors in Canada and the United States, and even some reputable businesses have eventually been exposed as multi-level marketing schemes.
The NASAA’s efforts also could spell trouble for the market as it attempts to account for the possible loss of several large corporations on the blockchain as a result of inquiries and enforcement actions.