In a drive to prevent fraudulent crypto outfits defrauding the public, Colorado’s Department of Regulatory Agencies (DORA) is to investigate three cryptocurrency-based companies which are offering unregistered Initial Coin Offerings.
The investigation is being carried out by DORA’s Division of Securities, as part of an ‘ICO Task Force’, aimed at identifying firms and individuals which may be deliberately swindling cryptocurrency investors in Colorado.
In a press statement about the investigation, DORA informs:
“The companies that received the orders are Bionic Coin, Sybrelabs Ltd. (also known as CryptoARB), and Global Pay Net (also known as GLPN Coin and GPN Token. Previous orders were submitted to Bitcoin Investments Ltd. (also doing business as DB Capital), EstateX, Bitconnect Ltd., and Magma Foundation (also doing business as Magma Coin).”
SEC warns about unregistered securities investments
Earlier this year, the Securities and Exchange Commission (SEC) warned the public against investing in unregistered securities, particularly the initial coin offering (ICO). The SEC urged cryptocurrency investors “to be vigilant when investing in this kind of investing activity and to take the necessary precautions in dealing with ICO entries.”
Colorado leading the race in blockchain legislation
Colorado has been described as one of America’s leading blockchain hubs, which is leading the race in blockchain legislation in the United States.
Such is Colorado’s thirst for cryptocurrency that when the state’s gubernatorial candidate Jared Polis was nominated in July this year, he mentioned blockchain-related policy as part of this campaign.
Despite Colorado’s strong ties with crypto innovation and legislation, the HB1426, legislation which would have created guidelines for identifying “open blockchain tokens” as securities, failed to pass the second round of the Senate.
More optimistically, the Senate Bill 86 was passed in Colorado, which sets out a framework about how the state is to investigate the use of blockchain technology to speed up admin processes and help business operations.
DORO’s investigation into several cryptocurrency organizations promoting unregistered initial coin offerings can be seen as a positive step in helping this crypto-embracing state weed out those abusing the drive for digital coin adoption and to help ensure cryptocurrency investors are not susceptible to fraud.
Gabrielle Pickard-Whitehead is a freelance journalist and copywriter based in the Peak District, UK. Since 2006, Gabrielle has followed her passion for writing and has sculptured a rewarding career out of her love for the written word. Gabrielle thrives on creating compelling content related to current affairs, politics, financial news and the latest advancements in technology and innovation. Gabrielle is excited about having the chance to write about the constantly-evolving world of crytocurrency and enabling people to learn more about this rapidly-advancing digital asset.