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The Securities and Exchange Commission has launched a bogus initial coin offering website to educate investors about scams.
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The website, HoweyCoins.com, has testimonials and messages from what appear to be celebrity promoters to entice investors to buy a cryptocurrency.
“The rapid growth of the ‘ICO’ market, and its widespread promotion as a new investment opportunity, has provided fertile ground for bad actors to take advantage of our Main Street investors,” SEC Chairman Jay Clayton said in a statement. The HoweyCoins website is named after a landmark 1946 Supreme Court decision, SEC v. W.J. Howey Co., which determined that certain transactions qualified as investment contracts.
Investor protection is an important aspect of the SEC’s mission, Jeff Bandman, a cryptocurrency regulatory expert, told Liz Claman in a FOX Business interview Thursday. “The SEC has formed a special cybercrime unit … to protect people, but they also are trying to balance their missions of capital formation and letting investors have more democratic access,” Bandman said. “What they’re doing is really a balancing act, and I think they are being very fair.”