The Texas State Security Board (TSSB) has published its list of “Top Investor Threats in 2020 – and How to Avoid Them.” Included on the list are crypto offerings.
The TSSB is the securities regulator for the state of Texas. The regulator has been active in the pursuit of nefarious offerings in the crypto sphere.
The cryptocurrency threat is described by the TSSB as follows:
RISKS TO INVESTORS: Cryptocurrency offerings are extraordinarily volatile—meaning risky—and almost impossible for a layperson to understand.
Investments tied to cryptocurrency hit everyone’s radar in 2017 when the price of one bitcoin reached a record high of $19,891, an increase of 1,800% for the year. But less than two months later, the price had dropped to $6,846. Cryptocurrency prices continue to be in a constant cycle of boom and bust.
Promoters of these investments look to take advantage of people who are swayed by the idea of virtual currencies as a quick path to wealth.
Even seniors and retirees, who traditionally prioritize security over speculation, are being persuaded to invest in initial coin offerings and cryptocurrency mining pools.
The TSSB recommends that you determine some basic facts before you invest in any crypto offerings (if at all). The regulator advises making certain that real people are involved with a real location. Good advice. Additionally, under state law, securities offerings must be registered with the state regulator. You should also request audited records and other financial info to back up any claims.
If your money is stolen, you are pretty much out of luck – something we have seen played out time and time again.
If you are curious as to how many, and which issuers, have been the target of TSSB enforcement actions, the regulator has compiled a nice list for you to review. You can view them all here or below. Don’t mess with Texas.
The Texas State Securities Board was the first state securities regulator to enter an enforcement order against a cryptocurrency firm and to date the Securities Commissioner has entered 26 administrative orders involving 79 individuals and entities.
Dec. 20: USI-Tech Limited
Jan. 4: BitConnect
Jan. 24: R2B Coin
Feb. 3: DavorCoin
Feb.15: Investors in Crypto LLC
March 5: LeadInvest
May 15: Wind Wide Coin Inc.
Nov. 27: My Crypto Mine and Mark Steven Royer
June 28: Mikhail Rania Safiya
June 28: Madeline O’Farrell