New Jersey Authorities Are Latest To Target Fraudulent Crypto Enterprises
The summary cease and desist Order alleges multiple violations of the State’s Uniform Securities Law including offering investors an unregistered security, failure to disclose information about its physical location and failure to disclose financial health or the names of its senior employees. Bitstrades purportedly guaranteed up to 10 percent returns which accrued daily on investor accounts. Bitstrade is not registered to sell securities in New Jersey.
In a news release the New Jersey Bureau of Securities stated:
Bitstrade is further violating the law by failing to disclose key material facts to prospective investors, including the names of its executive officers, the address of its principal office, information about Bitstrade's financial condition, the risks of the Bitstrade Investment, and how Bitstrade invests investors’ money
There has been an avalanche of government action this year against suspected frauds in the cryptocurrency world, the most famous being against the Bitconnect platform that scammed users out of untold millions. It is quite clear that U.S authorities are in no mood to allow scams to continue operating in this space. Aggressive prosecution will inevitable lead to more growth in those platforms who are transparent and legitimate.
Time will tell if the sheer amount of scams will slow down now that regulators are ramping up actions, but it is certainly clear they will not be able to operate anymore with impunity.