Like regulators in a number of countries, the Philippines Securities and Exchange Commission (SEC) has been increasing its concern over cryptocurrency related investments. It has recently warned a cryptocurrency investment platform because it offered unregistered securities. The firm known as Onecash Trading, recruits’ cryptocurrency traders as their affiliate members and promises to reward them in local currency, whenever they recruit new members of the same scheme for Onecash Trading.
According to that SEC alert, the firm Onecash Trading has been promising potential investors returns of 200 percent interest over eight weeks. Though its registered headquarter is not known. Onecash claims its global coverage of services across 73 different countries. In a statement issued by SEC, it was said that the firm is offering unregistered securities to investors in the Philippines.
SEC thereby warned the public that such investment schemes are not secure whether they offer traditional currency use of money or cryptocurrencies such as bitcoin, ethereum, litecoin, dash, monero or any other such digital currency. It was also stated that all such transactions are considered as securities subject to the regulatory authority of the SEC.
It was further stated that any person involved with promoting, selling and recruiting investment services for Onecash, no matter if he is a salesman, dealer or agent, the person will face prosecution and serious penalties up to 5 million pesos ($270,000) or imprisonment of up to 21 years.
Suggestions for Online Traders
The SEC has also shown its concerns that many online trading platforms appear to investors as SEC-registered and regulated companies or firms while in fact they are not. In the same way, many of these firms sometimes call themselves as exchanges, giving the pseudo impression that they are being regulated by national securities exchange. To cancel any chance of further fraud in this regard the SEC has devised a pack of rules in the light of which online traders should ask the following questions before they decide to trade digital assets:
- Is your firm registered as a national securities exchange?
- Can any information be found in FINRA’s BrokerCheck about any individuals operating your firm?
- How do you ensure safety of your users’ trading and personal information?
- What kind of measures you take against cybersecurity threats?
- What kind of other services are provided by your firm?
- How does your firm select assets for its digital trading?
- Who can trade on the platform?
- What is the trading criteria for your platform?
- How do you set prices for your platform?
- Are all the users treated equally or not?
- Is your firm registered with the SEC for all the above-mentioned services?
The SEC hopes that the above measures would cancel any chance of fatal fraud in the online cryptocurrency related investments.