Massachusetts securities regulator halted operations of 5 ICO projects, ruling the firms were selling unregistered securities.
The Massachusetts Securities Division has recently issued consent orders requiring permanent suspension of five Initial Coin Offerings (ICOs), citing that the firms are selling ‘unregistered securities’, as Finance Magnates reported on Tuesday, March 27.
According to official data, Massachusetts Secretary of the Commonwealth William Francis Galvin ordered five firms, Mattervest, Pink Ribbon ICO, Across Platforms, Sparkco, and 18 Moons to shut down the sale of their tokens in the state. The Securities Division also ordered the ICO issuers to send rescission letters to investors and to refund them within 45 days of the order.
“An offering done to avoid registration with regulators should be seen as a red flag, and you should contact my office before investing,” Galvin said, addressing investors.
At press time, the only company that had alerted clients that their ICO was shut down was Mattervest. The company’s website shows the following message: “Mattervest has ceased operations.” The website of Pink Ribbon ICO, as well as its Facebook page are currently unavailable. The rest of the pages of Across Platforms, Sparkco, and 18 Moons are still operating at press time, without notifications about ceasing ICO operations.
In February, US Securities and Exchange Commission (SEC) chairman Jay Clayton stated that many ICOs are violating existing laws by selling unregistered securities to US investors and warned that ICOs “should pay more attention” since the SEC will investigate those potential violations further.
This week, Steven Seagal and the founders of the “Bitcoiin” ICO project announced they were leaving the organization following the completion of its ICO.
On March 26, Twitter confirmed rumors that it will ban cryptocurrency advertising, including advertisements of ICOs, in an effort to protect the public from potential scammers.