The Truth About ICO Influencers

Many initial coin offerings (ICO) in the marketplace have more hype than substance. The SEC has been actively cracking down on ICOs that aren’t following regulations. The next target: ICO influencers.

ico influencers

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Professional boxer Floyd Mayweather and music mogul DJ Khaled are two names that have been fined by the SEC for failure to disclose that they received money to promote ICO Centra Tech. Centra Tech made misleading claims about its service to investors, and a civil suit was filed in April 2018 alleging that the ICO was fraudulent. Mayweather and Khaled were caught in the crossfires and were forced to pay hundreds of thousands in penalties, along with several-year bans on promoting any securities.

Per the SEC, “Any celebrity or other individual who promotes a virtual token or coin that is a security must disclose the nature, scope, and amount of compensation received in exchange for the promotion.”

Mayweather and Khaled made many social media posts raving about these ICOs, but they failed to make a single mention of their status as paid influencers. But they aren’t alone, as the SEC cracking down on many of these influencers who have failed to disclose their relationships with these ICOs.

Understandably, this spooked many ICO influencers, with many scrambling to publicly disclose their payments and dealings.

In reality, this high level of scrutiny is a good thing, as it protects consumers and investors from fraudulent entities.

How Buying.com Is Complying With the SEC

In March 2018, the SEC stated they consider cryptocurrencies to be securities. With that announcement, crypto startups have started retooling their structures to ensure that they’re fully compliant.

Buying.com, on the other hand, has complied with the SEC from the very beginning.

We work with trustworthy influencers who fully disclose their paid relationships. If anyone promotes our project as a paid influencer, the public will be made aware of it.

We have a “lock-up period.” In 2017, ICOs were raising money with very little regulations. Due to high amounts of token flipping, regulatory bodies began to enforce lock-up periods. Essentially, a lock-up period is the length of time a token must be held before it’s sold. With the lock-up periods, ICOs cannot suddenly dump or raise the price of the stock. Buying.com has a lock-up period of 1 year. If an ICO has a lock-up period, you can typically find it listed in the white paper.

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Joe Riviello

Buying.com -Chief Operating Officer- As a technology development and marketing expert, Joe creates engaging, conversion-centric e-commerce experiences and cutting-edge solutions that maximize growth and profit. Joe is the founder of Zen Design Firm, LLC, a 10 year old web development and marketing company designated by e-commerce giant, WooCommerce, as one of just a handful of experts in development on the WooCommerce framework. Joe also serves on the Board of Directors for the Northeastern Economic Development Company and has advised multiple Fortune 500 companies on strategic growth initiatives with a specialization in digital marketing channels.

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