The State Securities Board presents these resources to help investors navigate the minefield of investment offerings tied to cryptocurrencies. 

Although the world of virtual currencies – with thousands of different currencies, and terms such as blockchain, initial coin offerings, tokens, and mining – may appear to be exciting and revolutionary, the most important thing to remember is that virtually all questionable securities offerings have similar warning signs. Investors should exercise the same caution and due diligence in virtual currencies as with any other opportunity.

Enforcement Report: Widespread Fraud Found in Cryptocurrency Offerings

This Investor Alert from the Texas State Securities Board highlights the results of a four-week "sweep" by its Enforcement Division into investment offerings that were tied to virtual currencies.  Enforcement Division attorneys and investigators conducted the sweep in response to a sharp increase in the number of securities offerings marketed to Texans. The investigation targeted promoters who appeared to be illegally and fraudulently using online advertisements, social media, and other public solicitations to attract Texas Investors.

Decrypting Cryptocurrency Scams

Joseph Rotunda, director of the Enforcement Division of the Texas State Securities Board, participated in a Federal Trade Commission workshop on June 25 on the emergence of scams tied to cryptocurrencies. The FTC convened a panel of regulators, academics, and consumer advocates to address the problem of fraudulent promoters taking advantage of increasing consumer interest in cryptocurrency-related investments. 

Emergency Cease and Desist Orders

The Texas State Securities Board was the first state securities regulator to enter an enforcement order against a cryptocurrency firm and as of Aug. 10, 2018, the Securities Commissioner had entered 11 orders, the most of any state. Click on the company name to read the news release on the action.

2017

Dec. 20: USI-Tech Limited

2018

Jan. 4: BitConnect

Jan. 24: R2B Coin

Feb. 3: DavorCoin

Feb.15: Investors in Crypto LLC

March 5: LeadInvest

April 5: Financial Freedom Club Inc., 911MoneyStore Inc., Capital Cash, Estrada Trucking Inc.

May 8: Bitcoin Trading & Cloud Mining Ltd.

May 8: Forex EA & Bitcoin Investment LLC

May 15: Wind Wide Coin Inc.

June 11: Mintage Mining, Symatri LLC, NUI Social