The Argentine central bank has announced that it will be making inquiries about cryptocurrency investment companies. In particular, the bank said it is researching companies that offer exceptional returns on cryptocurrency investments that are inadequate. According to the bank, these companies could act as Ponzi schemes and are currently investigating the possibility of taking legal action against them.
Central Bank of Argentina investigates crypto investment companies
The Central Bank of Argentina gave a Explanation Yesterday they explained the action they are taking against some cryptocurrency investment companies. The institution announced that it was scrutinizing some companies that “offer returns by operating on crypto assets and cryptocurrencies that are incompatible with reasonable parameters in financial transactions.” The bank also draws users’ attention to the use of these platforms, the performance and investment risk of which cannot be assessed by the institute.
The bank has already taken action against these companies in some regions of the country, reviewed them by the regulator for financial and stock exchange companies and issued cease and desist orders for these activities. The bank will now take legal action against the administrators of these companies.
Some of these alleged operations focused their efforts on specific provinces in the country and used advertising campaigns as hooks to attract more investors. The Argentine central bank discovered such activities in two provinces, La Rioja and Catamarca, which aimed to attract followers to participate in “non-transparent asset management systems”.
Cryptocurrency-related scams are not new to Argentina, but have multiplied this year. The NGO Bitcoin Argentina warned opposed this type of scheme earlier this year, noting that such groups would take advantage of the popularity of crypto assets in the country. At the time, Javier Madariaga, CEO of the organization, stated:
We see pyramid or Ponzi schemes with crypto being repeated in different provinces of the country, and the common denominator of these scams is an intermediary who promises a great economic return by making a capital contribution that is not guaranteed with any investment.
In relation to these operations, the Central Bank of Argentina has also begun to take measures to control the increase in these activities. The institute announced that it is now contacting these companies to ask them to stop investing and are examining whether legal action should be taken against the alleged Ponzi schemes.
What do you think of the investigation that the Central Bank of Argentina is conducting against crypto investment companies? Let us know in the comments section below.
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Source: Crypto News Austria