United States Regulators have managed to file more than 90 crypto fraud cases over the past two years but according to reports that we came across in today’s crypto news, we can see that the regulators have only managed to recover $36 million.
Despite the fact that is extremely difficult to determine the exact amount of the funds that investors lost, the analysis shows that only a small portion of the funds has been recovered. Tracing the funds is also very problematic since the transactions are anonymous and also because of the nature of cryptocurrencies.
The US Securities and Exchange Commission has filed only five cases for 2017 which is an even bigger problem for investors since the procedure is long and tiring. Although some investors did get their money back, other investors weren’t so lucky. For example, the BitConnect reached $2.8 billion in market value but it quickly shut down operations after the company received a cease-and-desist order by the Texas State securities Board back in January.
The Texas Securities Commissioner accused BitConnect of violating the Texas Securities Act after selling securities without the state’s Securities Commissioner authority. For this reason, it was ordered to BitConnect to immediately cease and desist from offering securities selling.
It is important that the lawsuits against crypto fraud schemes increased massively in 2018 by three times more than 2017.
In the first two quarters of 2018, there was a huge increase in the number of securities cases that were related to any cryptocurrency and case filings related to this issue surged from seven cases in Q4 2017 to 23 cases in Q2 2018.
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