This time Floyd Mayweather was Knocked Out (KO):
Centra Tech ICO has been under the scanner. The SEC alleges the Floyd Mayweather backed ICO of being an unregistered security offering and it also goes on to say that its founders Sohrab “Sam” Sharma and Robert Farkas “engaged in fraudulent conduct and made material misstatements and omissions designed to deceive investors.” The ICO had raised $32 million last year through an ICO. This was followed by KuCoin and OKEx delisting them.
The SEC further alleges that a lot of partnership claims made by Centra are nothing but a plain white lie. These partnerships included big names like Visa, MasterCard, and Bankcorp. All these institutions have sent several cease and desist order to the company. For Centra, imagination knows no bound, even some of its team members are fictional. Not sure if they drew their inspiration from Miroskii, who earlier used an image of Ryan Gosling for Kevin Belanger, their fictional graphic designer. Seriously, Ryan - freaking - Gosling!! The folks at Miroskii must be nuts to have done that.
But what is concerning is the fact that celebrities are endorsing ICOs without enough due diligence. The public blindly invests their money hoping that their favorite celebs know what is the best for all of them. In case of Centra, it was Floyd Mayweather and DJ Khaled. A point in case is Paris Hilton’s endorsement of Lydian ICO and not to forget John McAfee revelation of charging$105,000 per promotional tweet for ICOs
The SEC has come up with subtle guidelines for such endorsements. It states “Any celebrity or other individual who promotes a virtual token or coin that is a security must disclose the nature, scope, and amount of compensation received in exchange for the promotion. A failure to disclose this information is a violation of the anti-touting provisions of the federal securities laws.” We can expect stronger laws in this regard in future.
What really needs to improve is the quality of investors investing in ICO. Most investors consider ICO to be a ticket to quick money and invest without understanding the consequences. Investors are expected to understand the vision of the ICO aka “Why are they raising money?” And check for the credibility of the founders and see if all of their claims such as partnerships/prototypes do exist in reality. It is difficult to assess all of these parameters factually but a good amount of digging should help.
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Topic: BITCOIN (Read 6596 times)
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