In an attempt to protect people from fraud and investment scams; the French Stock Market regulator has announced to blacklist 21 new investment websites related to cryptocurrency and crypto assets. The regulator Autorite des Marches Financiers (AMF), declared the group of sites offer ‘atypical speculations’ and guides users to its ‘blacklist’ which it claims is not ‘far-reaching.’ In March, the controller added about 15 websites to its blacklist claiming that investors were ignorant of the fact that high investment returns include high risks. The reason for this, as the regulator points out was these companies were using fraudulent advertisements to woo investors.
The Belgian watchdog also took a similar move earlier this month, when it included 28 websites to its blacklist of crypto-related fraudsters. The Belgian Financial watchdog, Financial Services and Markets Authority (FSMA), reinforced on its caution to consumers about scams in the cryptocurrency field.
Initial Coin Offerings
The French Government earlier gave new legal powers to the Stock exchange Market watchdog for granting licenses to companies running Initial Coin Offerings (ICO).In a press release. The French Minister of Finance reiterated that he hopes the country’s legal framework; for Initial Coin Offerings and Initial Public Offerings would offer a lucrative investment opportunity to global investors.
The implementation of cryptocurrency rules pertaining to crypto assets states that for a company to undertake an ICO, it should file an application with the watchdog to be granted a license. The application will entail submitting a report of detailed information concerning the offer as well as the company’s background information.
The license offers guarantor-ship to ICO companies since the avenue has high frequency scams and high risks.
The Blacklisted Websites
The regulator published in media advertisements against investors investing in offers they do not understand. It was in the same spirit that the Governor of the Bank of France implored warnings on the risky task of investing with Bitcoin.
French authority claims that the list is still not comprehensive and will continue adding more names with time. Sites advertising significant risk factors and exaggerated returns were put on the map of those deserving a blacklist. Global financial authorities are employing all manners of task forces to curb the realities behind the financial world’s biggest scams. Authorities believe quick responses to cryptocurrency scams would efficiently exterminate fraudsters on the blockchain.
The trend of scams is growing global with each passing day. Authorities from all over the world need to take measures to curb the fraud from the root. France and Belgium are not the first in a line of watchdogs taking extreme measures to protect their investors. The move, despite being a method of protecting internal financial operations; it is also a step towards safeguarding the country’s interests to attract international ventures.
As much as Blockchain companies would wish; to have a sophisticated legal framework to attract more investors. It could scare upcoming startups from authorities due to the complicated legal process required to satisfy financial watchdog’s requirements.