Dutch Securities and Exchange Commission warns of ICOs

The Dutch stock market supervisory authority warns in a statement of caution. Investors within the country should be aware of the risks of investing in initial coin offers (ICOs for short).

The Autoriteit Financiële Markten (AFM for short) - which has roughly the same tasks as the German BaFin - today stated in a statement that there are risks for the market of new cryptocurrency and that this would also include the financing model ICO.

Merel van Vroonhoven, AFM President, said in a statement:

"Although the AFM sees the opportunities offered by blockchain technology for financial services, it would like to highlight the major risks of the current ICO hype. There is a high risk of fraud and loss of assets; Combined with the hype about ICOs, this is a dangerous mix. "

The agency also lists a number of threats to investors. This includes the lack of transparency of some ICO organizers. The AFM also warns of promises of high profits and the risk of price manipulation.

In another opinion, one official called for more cooperation in this matter between authorities. "We have now sent this warning to other authorities in Europe. ICOs are an international phenomenon and reach consumers/investors beyond the borders. It is important that we work together with other European authorities, "he said.

In the past, stock exchange supervisors around the world have issued similar statements. Also, the Federal Financial Supervisory Authority (BaFin) recently warned about the financing model. In other states, people even went a step further; China and South Korea banned ICOs altogether. According to the Dutch media, however, this step is outside the remit of the AFM.

The European Securities and Markets Authority, whose role it is to contribute to the stability and effectiveness of the financial system, today issued a similar opinion.

According to the Coindesk ICO tracker, approximately $ 3.3 billion was transposed through the ICO financing model