Malaysia’s Securities Commission is the latest regulator cautioning investors about potential risks involved in the burgeoning cryptocurrency schemes.
The regulator reminded Initial Coin Offering investors (ICO) to seek legal or other professional advice to address any doubts on the legitimacy of such schemes, seeing that the terms and features of ICO schemes may differ across cases.
«Investors should take note that scheme operators may not have a presence in Malaysia.» said the Hence, it would be difficult to verify the authenticity of the scheme and the recovery of foreign-invested monies may be subject to foreign laws or regulations,» the Securities Commission (SC) said.
The SC also added that since some of the ICO schemes operate online and may not be regulated, investors may be exposed to heightened risks of fraud, money laundering and terrorism financing.
Regulators across Asia have been going on record warning investors keen on ICO’s of the potential dangers. Last month the Monetary Authority of Singapore (MAS) issued an investor warning, advising the public to exercise due diligence to understand the risks associated with ICOs and investment schemes involving digital tokens.
In one of the strongest actions The People’s Bank of China banned fundraising by way of token-based digital currencies, deeming the practice illegal.
The Hong Kong Securities and Futures Commission (SFC) quickly followed issuing their own notice urging investors to be mindful of potential scams as well as the investment risks involved in ICOs.