Colorado Regulators Crack Down on Four More ICOs

The state's "ICO Task Force" has now issued 12 cease-and-desist orders since May of this year.

AccessTimeIconNov 9, 2018 at 8:15 p.m. UTC
Updated Sep 13, 2021 at 8:34 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Colorado regulators took action against four ICOs Thursday, bringing the state's total number of cease-and-desist orders against crypto startups to 12.

The state's "ICO Task Force" rebuked Bitcoin Investments, Ltd, PinkDate, Prisma and Clear Shop Vision Ltd. Where the companies are based is unclear, a spokeswoman for Colorado's Division of Securities told CoinDesk, though the unregistered securities they promoted were available to Colorado residents.

Colorado Securities Commissioner Gerald Rome told CoinDesk:

"We want to ensure that the state's securities market and the investors that operate within it are protected from unscrupulous actors that are taking advantage of the enthusiasm surrounding this field to perpetrate fraud and in some cases outright theft. There are many companies in Colorado that are working hard to conduct their ICOs the right way, and we are eager to continue working with them to build a regulatory framework for the industry as it relates to securities."

Rome added that the enforcement action is meant to advance Colorado as an "innovative leader" in the cryptocurrency space. Though the state's ICO Task Force has been active since May, the cease-and-desist orders come just days after Colorado elected a crypto-friendly governor in Congressional Blockchain Caucus member Jared Polis.

More U.S. state regulators are taking action against potentially fraudulent token sales. Earlier this week Texas issued emergency cease-and-desist orders to crypto mining firms based in Australia and Canada.

As CoinDesk reported in August, a coalition of North American securities regulators is conducting more than 200 investigations. The so-called "Operation Cryptosweep" – which the Colorado Division of Securities is participating in – is meant to stifle cryptocurrency scams.

"You're starting to see now the results of those investigations," said Bob Webster of the North American Securities Administrators Association (NASAA), which is playing a coordinating role in the Cryptosweep effort.

Webster says Colorado is among the more active jurisdictions in the U.S., along with Texas, North Dakota and Massachusetts.

Anthony Tu-Sekine, who heads up the cryptocurrency arm of law firm Seward & Kissel LLC, says a number of state regulators are jumping into the fray to combat what are often "thinly disguised Ponzi schemes."

Colorado State Capitol image via Shutterstock

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.