The US Securities & Exchange Commission (SEC) has come up with a visionary way to enlighten naïve investors against fake Initial Coin Offerings (ICOs). In an attempt to avoid cryptocurrency scams, they launched their own fake Initial Coin Offering (ICO) website called Howey Coin, to provide a protection bubble against illicit cryptocurrencies.
On May 16, the agency introduced a supplement cryptocurrency called Howey. Howey is offering exciting discounts as a part of pre-sale, which, we all know is usual for ICOs, but the difference here is that as soon as you click to buy the tokens, you are redirected to investor.gov, and Baam! The fun ends. The website, to which you are redirected, also belongs to the SEC which informs users about detecting danger flags in fraudulent ICOs. Fake ICOs usually guarantee unrealistically high returns while suggesting you to invest on the basis of false, misleading and highly exaggerated statements.
SEC Chairman, Jay Clayton, issued an official statement that said: :
“We embrace new technologies, but we also want investors to see what fraud looks like, so we built this educational site with many of the classic warning signs of fraud. Distributed ledger technology can add efficiency to the capital raising process, but promoters and issuers need to make sure they follow the securities laws. I encourage investors to do their diligence and ask questions.”
It is clear that the US government is getting more and more operative in their fight with the huge load of cryptocurrency scams. Previously, the SEC charged on the developers of Mayweather and let’s not forget how DJ Khaled had to backup from his Cryptocurrency startup, Centra Tech. Apart from the introduction of Howey Coin, the US Federal Trade Commission (FTC) will also be hosting a workshop to spread awareness against cryptocurrency scams.