The US and Canadian financial regulators have been co-ordinating their efforts to shut down fraudulent initial coin offerings. The plan, known as Operation Cryptosweep according to the Wall Street Journal, has 70 open operations and another 35 pending.
At a press conference on today Joseph Borg, president of the North American Securities Administration Association said: “the action announced today is just the tip of the iceberg”.
State-level regulators in the US have signed a memorandum of understanding with the US Commodity Futures Trading Commission to share information that is not in the public arena, as the vice tightens on the activities of the scam operators.
Billions have been raised in token crowd sales, which is probably one of the most successful use-cases to date for blockchain, and threatens to upend the way that some tech companies raise early-stage funds.
The Wall Street Journal last week reported on the results of an investigation it had conducted into 1,450 ICOs and found that 271 of them raised red flags, with investors losing at least 2$273 million in the projects highlighted, although the WSJ did not provide the names of the projects.
The US Securities and Exchange Commission is still yet to officially decide whether ICOs are securities.
Gary has been writing about cryptocurrencies since 2013 and currently works as the cryptocurrency analyst at interactive investor, the UK’s second-largest online investment platform. Gary contributes for Coin Intelligence News in a personal capacity and none of his commentary should be considered investment advice. Gary is the winner of the ADVFN International Financial Awards 2018 Cryptocurrency Writer of the Year. Contact Gary on twitter at: @gary_mcfarlane