Spain’s financial watchdog, CNMV, has warned a crypto-based website for endorsing ICOs for AlyCoin (an Ethereum-backed token). The regulatory authority blacklisted the website after finding out that it’s supporting the unapproved operation of a crypto investment vehicle in the country. It stated that the company should have taken approval from the Spanish financial regulator before embarking on sensitizing the Spanish citizens for such an investment offer.
CNMV is accusing AlyCoin of providing Clients financial services and imploring them to invest, which is against the Spanish Government’s Securities Markets Law. Although CNMV did not give more details about the warning, it’s evident that the website is not authorized to operate in Spain since it’s not officially registered in the country.
CNMV is not the only regulator to enforce the securities law on unregulated companies. Other European regulators have, from time to time, issued warnings to companies that breach their operation guidelines. They have frequently issued out restrictions and warnings to crypto-based firms that promote cryptocurrency investments and mining.
However, the Spanish regulator does not offer technical details of the warnings. Instead, it passes the message across with plain Spanish language so that it could be accessible to the public.
Since 2017, the Spanish regulator has continued to update its rules regarding advertisement requirements, leverage, risk disclosure, and trading stocks. The regulator already set rules that limit brokers from offering leverage of more than 10:1. The idea is to protect investors from losing so much in the highly volatile markets. Retail investors, in particular, should not consider such investments because of the complexities involved. The regulator fervently warns investors to stay away from investors offering more because of the high risk involved. The main goal of the regulator is to ensure a level playing field where investors are protected from unrealistic investment plans with a high level of risks.
The regulator also warns operators to inform clients of the estimated cost, especially for those who want to close their transaction position as quickly as they have entered.
AlyCoin pointed out that it’s an independent Ethereum-based token. The token owners have also reiterated their desire to play according to the guidelines and regulations of the host country. It claims to be offering 82 million tokens to the Spanish public. The tokens will last from 24th December 2018 to 24th December 2018. Within the period, Alycoins intends to offer about 35 million tokens to the public, with a starting price of $0.10 per token.
Alycoin has stated that the company intends to get a license for any operation it wants to carry out in any country. It, however, stated that it might not be possible to get the necessary approval on time for such because of the regulatory bottlenecks in certain countries.
As a result, AlyCoin’s inability to get the required license from the Spanish regulatory authority is a big hindrance to its goals in the country. The company stated that it is still working on resolving the issue with the regulatory body.
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