by Staff Writers
Paris (AFP) Nov 13, 2017
A European financial markets watchdog warned Monday of the risks to investors of putting money in Initial Coin Offerings (ICOs), and to firms of stepping over the line of legality.
The Paris-based European Securities and Markets Authority (ESMA), an independent EU body, said it had observed "rapid growth" in ICOs and "is concerned that investors may be unaware of the high risks that they are taking when investing in ICOs".
Firms issuing ICOs, meanwhile, "may conduct their activities without complying with relevant applicable EU legislation", the body said.
In offerings of ICOs -- a term borrowed from Initial Public Offerings (IPOs) on stock markets -- a group of people creates its own virtual currency and raises funds by selling it to investors.
These coins are then traded for traditional currencies, like the euro or the dollar, or other virtual currencies like bitcoin or ether.
The price of a new coin, also known as a "token", is "typically extremely volatile", the ESMA noted, and warned investors may not be able to redeem them "for a prolonged period".
If such operations fall outside of EU rules and regulations, investors also cannot benefit from legal protection if the investment goes sour, it said.
Fraud and money laundering were also a risk possibly involved in ICOs.
The warning comes as bitcoin, the best-known virtual currency, is experiencing a volatile trajectory.
Early Monday, bitcoin fell to $5,605, a drop of nearly 30 percent from its November 8 record high. By late morning, it had recovered somewhat to $6,425.
Analysts said traditional bitcoin is under pressure from rival "bitcoin cash", which was created this summer by a breakaway group of bitcoin users.
Manila (AFP) Nov 12, 2017
Hong Kong and Southeast Asian nations signed a free trade deal Sunday, in what one minister described as a "clear vote" against protectionism, as the United States withdraws into its "America First" rhetoric. The city, a special administrative region of China, forged the agreement with the Association of Southeast Asian Nations (ASEAN) on the sidelines of a summit in Manila to be attended by ... read more
Global Trade News
|The content herein, unless otherwise known to be public domain, are Copyright 1995-2017 - Space Media Network. All websites are published in Australia and are solely subject to Australian law and governed by Fair Use principals for news reporting and research purposes. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA news reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. All articles labeled "by Staff Writers" include reports supplied to Space Media Network by industry news wires, PR agencies, corporate press officers and the like. Such articles are individually curated and edited by Space Media Network staff on the basis of the report's information value to our industry and professional readership. Advertising does not imply endorsement, agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement|