The SEC added to their ongoing list of warnings about crypto by warning about ICOs twice this week. We explain both SEC warnings.
The warnings were:
- Investor Alert: Celebrity Endorsements – Where they warn that just because Paris Hilton says its a good idea, doesn’t mean it is.
- SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds – Where they warn that some ICOs make absurd claims that, as you perhaps could tell from their shady white-paper and site, were not true. For example, the REcoin, or real estate coin, and the DRC, or Diamond Reserve Club, are both a scams operated by the same guy (Maksim Zaslavskiy).
In other words, the SEC is correctly and wisely confirming what we all know instinctively… some ICOs are scams.
Unlike our armchair assumptions though, the SEC is likely basing these claims on data they have (this can be confirmed for the real estate and diamonds scam, but we are assuming this for the celebrity one).
NOTE: From here forward I am going to make the news fun by cracking jokes. If you don’t feel like being half-entertained by my lame jokes, just read through the SEC’s less colorful advice.
Look, you don’t buy a grill just because George Forman tells you to… er. Well, you don’t vote a guy for President just because he gave you a hard sell on TV… Oh, wait, never mind. A lot of people are probably going to get swindled here.
Do me a favor. Don’t get swindled. Read the SECs advice and follow it. When someone offers you something that is to good to be true, when they make that hard sell, at least be skeptical. Bitcoin at any price is better than some made up real estate coin.
Remember the SEC isn’t telling you not to buy $7k Bitcoins, they are simply warning you not to believe the hype about some ICO that says it is backed by Diamonds just because they paid of some celebrity to tout it.
You have to be able to spot a con with important matters like investments. If you doubt that you can, wait until an ICO launches to buy in. Most ICOs see their tokens go down before they go up. Once it is on the market, then you at least know its real. See more about ICOs.
JOKING: I’m not saying buy TrumpCoin. I mean, lots of people probably missed out on the tremendous value of that big beautiful coin. Its OK not to be a winner. Not everyone is going to win like those, smart, and I mean very smart trust me, people who buy TrumpCoin. That may sound like a joke, and indeed it is a joke…. But the point I’m making here is not a joke. On January 20th TrumpCoin was pumped and that means some people ended up “holding the bag” (they bought high and held until it went low). Getting swindled by traders on the market over a random altcoin is bad, but buying into a scam ICO that isn’t even real is worse. This is the Wild West, be cautious… especially when .
NOTES: No disrespect to President Trump, just using the coin with his name to make a point here. It used to be, back when Bitcoin was under $1,000, that you could make political jokes without dividing the country in half. You can’t anymore. But then again, we all need to be able to put politics aside and focus on money here. Its what Trump would want. 😀
TIP: If you really want to buy into an ICO that seems shady, I suggest taking a look at Useless Ethereum Token. That is what honesty looks like. Sure, some ICOs are great, but like, “some” being the key word.