SEC Launches its Own Fake ICO as Warning to Investors

Avi Rosten
  • The SEC's very own coin named "HoweyCoin" comes complete with a website featuring a team, testimonials and a whitepaper
  • The regulator hopes the fake coin will educate would-be investors about fraudulent ICOs

The SEC (The US Securities and Exchange commission) has today announced an intriguing new initiative designed to educate investors about fraudulent ICOs.

The regulator has launched its own ICO - HoweyCoin - complete with a website showcasing the ICO pre-sale, team, whitepaper - and even tweets touting the potential of the new coin.

The coin aims to revolutionize the travel business, explaining that most travel businesses need “processing, centralized currency and…nickel and dime fees that add up to literally billions.”

Howeycoin differs, however, because:

“HoweyCoins utilize the latest crypto-technology to allow travelers to purchase all segments without these limitations, allowing HoweyCoin users to buy, sell, and trade in a frictionless environment – where they use HoweyCoins to purchase travel OR as a government-backed, freely tradable investment – or both!”

HoweyCoin

The twist is that HoweyCoin is fake - and users who try and invest in the sale are redirected to the SEC’s educational site which reads:

“If You Responded To An Investment Offer Like This, You Could Have Been Scammed – HoweyCoins Are Completely Fake!”

SEC

Presumably named after the legal “Howey test” that the SEC uses to determine whether a financial instrument is a security, the ICO claims that investors can expect to receive 1-2% returns and offers token sale discounts to early investors alongside pictures of exotic locations.

In a press release, the SEC explained that the whitepaper included on the site was designed to mimic other whitepapers, and features:

“a complex yet vague explanation of the investment opportunity, promises of guaranteed returns, and a countdown clock that shows time is quickly running out on the deal of a lifetime."

SEC

While many within the crypto world regularly express their discontent with regulatory bodies and see them as stifling the industry, this latest move from the SEC will no doubt serve as an important warning to would-be investors, and might at least raise a smile from the regulator’s detractors.

Featured Image Credit: "Securities and Exchange Commission" by "Scott S" via Flickr; licensed under "CC BY 2.0"

Sparkster (SPRK) Debuts at 10% of ICO Price, Bittrex Geofences 32 Cryptoassets

Today's top news from the cryptocurrency and blockchain space:

  • Top crypto-regulation advocate predicts impact of Facebook’s cryptocurrency.
  • Sparkster’s SPRK token goes live on exchanges at only 10% of its ICO price.
  • Bittrex to disable support for 32 cryptocurrencies for U.S. customers.

At the time of writing, bitcoin (BTC) and ether (ETH) are trading at $7,954.79 (2.35%) and $242.21 (1.84%), respectively. The MVIS CryptoCompare Digital Assets 10 Index, it is currently tracking at 3,861.18 (+4.47%).

Bitcoin Ethereum CryptoCompare

Top Crypto Spokeswoman’s Facebook GlobalCoin Prediciton

Caitlin Long, a former Wall Street executive actively pushing for cryptocurrency- and blockchain-oriented regulations, shared six predictions about the ramifications surrounding Facebook’s forthcoming GlobalCoin stablecoin.

Among the predictions shared by Long – who has been a driving force behind the U.S. state of Wyoming’s establishment of a crypto-friendly regulatory environment – was that developing economies will be significant beneficiaries of Facebook’s GlobalCoin.

In terms of how the social media giant’s stablecoin launch will impact bitcoin (BTC), Long was optimistic; tweeting her belief that Facebook “will pull more users into #BTC (sic) whether it intends to or not.”

Sparkster’s SPRK Debuts at 90% Loss

Sparkster, a blockchain project that completed a $30 million initial coin offering (ICO) in July 2018, unlocked its SPRK tokens yesterday. After selling for $0.17 (USD) per token during the ICO, SPRK debuted on multiple cryptocurrency exchanges for roughly one-tenth of its price; a 90 percent loss for those who invested almost twelve months ago.

Bittrex Latest to De-List Cryptocurrencies for U.S. Traders

Major cryptocurrency exchange operator, Bittrex, announced it will disable support for thirty-two listed coins for customers based in the U.S. Effective on June 21, the U.S.-based exchange stated in a blog post that:

U.S. Customers will be sent an email communication from Bittrex that provides guidance on what they can and cannot do with their affected Tokens/Coins in connection with this change before an affected market is no longer available.

Among the cryptocurrencies set to be disabled on Bittrex – and transitioned to Bittrex International – are Storj (STORJ), Gifto (GTO), and Enigma (ENG).

Bittrex’s decision comes only a few weeks after fellow U.S.-based exchange, Poloniex, stopped offering nine cryptocurrencies to domestic customers due to regulatory uncertainty.