The Chinese government found 421 fake cryptocurrency

Subordinated to the government of China national Committee of experts on the techniques of financial security on the Internet (IFCERT) on Friday published a report according to which in April 2018 have been identified 421 fake cryptocurrency. In addition to the results of the analysis of false cryptocurrencies, the Committee also published the main warning signs exposing fake currency.

«In recent years, cryptocurrencies have been at the centre of attention. Technology has also attracted scammers, who started to build pyramid schemes under the guise of virtual currencies. Such projects are more and cause investors to lose large sums of money,» noted the Committee. The platform continuously monitors IFCERT fake cryptocurrency.

«The report shows that as of April 2018 IFCERT found 421 fake cryptocurrency, and over 60% of servers are fake coins deployed outside the country. In this regard, it is difficult to find and keep track of platform fake cryptocurrency».

The Committee also outlined the warning signs that will help you to understand what a cryptocurrency is a fraud. First, the creators of the coins is to use the «business model on the base of the pyramid», arguing that their coins will generate a high yield. Second, they have no real code and not its own blockchain or the possibility of creating blocks for him. Thirdly, they will not be sold on major cryptocurrency exchanges, «so they often traded on OTC platforms or exchanges», the report said. The Committee also notes:

«Prices on these platforms are controlled by organisations or individuals, which leads to the illusion of rapid growth in the value of the asset. However, users are often unable to carry out transactions or to withdraw funds from the site».

IFCERT stressed that fake cryptocurrency have no value and are illegal, arguing that «many of these platforms do not have offices, and their servers are often deployed abroad», so victims are unlikely to receive compensation for their losses.

However, the problems of the industry do not end with fake cryptocurrency. Last Thursday’s Wall Street Journal has published its findings after a review of the documents prepared for 1450 ICO. The publication notes that it was «discovered 271 ICO with warning signs, which include plagiatora documents to investors, promises of guaranteed returns and a fake development team».

Investors have invested in these ICO more than $1 billion. The publication also notes that «some firms still raise funds, while others have closed. Still, investors said the losses in these projects to $273 million in accordance with lawsuits and regulations».

ICO fraudulent and false cryptocurrencies are becoming more common, which attracted the attention of regulators. Recently, the Commission on securities and exchange Commission (SEC) has created a website with «fraudulent ICO» to teach investors that «looks too good to be true investment opportunity,».

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