Colorado Investigating Three Cryptocurrency Firms

The Colorado Department of Regulatory Agencies is investigating three cryptocurrency firms for promoting unregistered initial coin offerings in the state. The investigations are part of a growing trend of fraudulent companies looking to make quick money. All three firms failed to show up at a hearing to present evidence as ordered by the Commissioner.

Three Crypto Firms Being Investigated

Members of the Division of Securities of the Colorado Department of Regulatory Agencies (DORA), and of the state’s initial coin offering (ICO) task force, have been investigating cryptocurrency firms for promoting unregistered ICOs in the state. The task force was set up in May to identify companies or individuals that might pose a risk to Colorado investors.

“As part of an investigation into what has become a trend of allegedly fraudulent companies looking to make quick money,” the agencies announced Monday that “Colorado Securities Commissioner Gerald Rome has signed orders to show cause for three cryptocurrency companies” soliciting to Colorado residents. The announcement details:

A spokesperson for DORA told news.Bitcoin.com that “the hearing to show cause occurred on Friday, August 24th…and none of the companies listed responded,” adding:

Bionic Coin

Bionic Coin’s website provides information about an ICO for bionic or BNC, an ERC20 token aimed at enabling “instant payments to anyone, anywhere in the world, and to simplify the purchase of electronic devices and software,” the agencies described. However, “there is no physical address or control person identified on the site.”

The site also attempts to incentivize users to promote the coin by “stating that individuals who post to popular social media sites and blogs will receive up to ten thousand tokens per post.”

Sybrelabs

The company encourages its members to promote the investment pool and recruit other members by providing them with marketing materials and souvenir products. The website also “offers large percentages of profits for minimum participation of $25.00, up to soliciting ‘active investment portfolios’ of $25,000 or more,” DORA wrote.

Global Pay Net

Furthermore, while the company’s website lists multiple cryptocurrency professionals as being involved, two of them have denied involvement. A claim of a filing with the US Securities and Exchange Commission (SEC) also could not be verified, the agencies revealed, adding that there was no business filing in Washington State where the company is supposedly located.