SEC fighting scam ICOs

The SEC's Division of Enforcement has made a crack down on fraud in the cryptocurrency sector one of its spotlights. Particularly initial coin offerings (IOCs) get emphasis from the US Securities and Exchange Commission (SEC). This was made clearly in its fiscal year 2018 annual report.

One of the major risks for investors in ICOs, is that these projects have no history of performance or a viable product. On top of that they don't generate revenue or have adequate cyber-security. Even worse are the examples that cloak a project in blockchain technology, giving the illusion of using the emerging tech. But in the end, the entire project is a fraud.

Currently the SEC is shutting down many ICO's that used celebrity endorsements. The agency is very clear on its position on those promotions, as it's reversing the trend. They want to protect main street investors as much as possible.

In this calendar year the SEC issued more than 12 enforcement actions involving digital assets and ICOs. Among those was Titanium Blockchain, which faked relationships with the Fed, Paypal and others, and TokenLot, which promoted itself as an ICO superstore, but was actually an unregistered broker-dealer. Another unspecified ICO promised '13-fold profit in less than a month'. There have been money other cases, while some of them are still being investigated.