Zambian SEC warns users against investing in ONYXCOIN promising 1000x returns
Zambian Security and Exchange Commission (SEC) has warned its citizens over their investment interest in ONYXCOIN, as reported by a local daily. The warning came after an increased number of public inquiries about a firm called KWAKOO which has been suggesting people to invest in an unknown cryptocurrency called ONYXCOIN.
SEC Chief Executive Officer Philip Chitalu said that they received a significant amount of questions regarding the firm recently as they have been promising ‘unimaginable’ returns. This was a clear sign of a Ponzi scheme in the making as the firm was not authorized by the SEC to carry out any such promotions or investment advise.
Chitalu reported that the promoters at KWAKOO have been promising 1000x returns by June 2021, which violated the country’s Securities Act 41 of 2016. The Security act states that any firm, promotor or advisor are required to get licensed by the SEC if they are promoting any security and advising people to invest in it.
The chief also went on to explain the importance of licensed service providers as they are continuously under the watch of SEC which ensures consumer protection. He also spoke about the risks involved in dealing with crypto offerings such as Onyxcoin, since it is not licensed or regulated, it carried the risk of turning out to be a Ponzi scheme.
The frenzy around ICOs and various other crypto offerings makes a perfect setting to lure people looking to ‘get rich overnight’. This development shows the need for consumers to understand the difference between a genuine service offering and something like ONYXCOIN promising baffling returns on investment without any roadmap to achieve it.