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Federal Trade Commission to Hold ICO Scam Workshop

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Federal Trade Commission to Hold ICO Scam Workshop

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The United States Federal Trade Commission (FTC) will be hosting a cryptocurrency workshop to address the critical concerns of scams as well as consumer and investor security within the industry.

Educational workshop

The Decrypting Cryptocurrency Scams’ workshop will be comprised of law enforcement, research organizations, consumer groups and the private sector to discuss the exploitation of consumers and explore means to protect consumers.

The FTC has been working on creating adequate protections for consumers in the age of new emerging financial technologies for quite some time. The educational workshop should lend itself toward easing the already restrictive US laws and legislation that are in place, that is, if the workshop manages to make a serious impact.

Complications in the US

The United States has some rather mixed, directionless stances on cryptocurrencies and initial coin offering (ICO) regulations. In July 2017, the SEC classified ICO tokens and cryptocurrencies as “investment contracts” and, therefore, as securities based on the Howey Test, though there appear to be no regulatory guidelines for digital coin developers to comply with.

Due to these grey areas, legal uncertainties and strict investment regulations, US citizens will also struggle to find an ICO that they can participate in; many ICO operators and companies have made a choice to ban US investors from offerings.

The SEC has also been slightly aggressive in the pursuit of gathering data on the industry; having recently issued 80 subpoenas the SEC is charging ahead with firm investigations which may be perceived as potentially having a negative impact on the industry but actually, the tough stance is not without progress.

An FTC and SEC crypto education

Despite the somewhat negative stories emerging from the US, the SEC has also taken the educational approach and launched a website that for a fake Howeycoin ICO, designed to show what a scam or hoax token offering should look like.

Following this and hopefully, the combined efforts of the SEC and FTC can keep cryptocurrency and blockchain related discourse on the table and hopefully push decision-makers towards creating a more definitive framework for ICOs and their accompanying cryptocurrencies.

 

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