Canadian regulator warns agaisnt so-called cryptocurrency bank

Canadian Financial Regulator Warns Against Investing in so-Called Cryptocurrency Bank

Canada’s Financial and Consumer Services Commission (FCNB) recently sounded the alarm on a so-called cryptocurrency bank, dubbed Bitcoin-bank.io. The project’s initial coin offering (ICO) isn’t registered, and could potentially be a scam.

Bitcoin-bank.io, according to its website, promises investors daily returns on their funds through their “BTCB” token. The company bills itself as a cryptocurrency bank, and notably claims to offer payment card solutions and wallet services, along with the BTCB investment that’ll bring in more money thanks to a formula that makes cryptocurrency trading highly profitable.

The FCNB’s warning was directed at New Brunswickers. It was issued after the regulator noticed Bitcoins-bank.io was advertising its investment opportunity on a Canadian online classified website.

While looking into the investment scheme, the FCNB noticed that it isn’t registered, and is therefore illegal. The warning reads:

“Since it is not registered to trade in, or advise on, securities or derivatives in New Brunswick, it is illegal for Bitcoin-bank.io to carry out these activities in the province.”

Moreover, the FCNB’s investigation discovered that some of the marketing materials the so-called “cryptocurrency bank” distributed contained false information. An advertised street-listed address in California was found to be false, as the company is seemingly not there.

The regulator further notes that some of the pictures used for the team’s profiles seem to have been taken from the internet. Those behind Bitcoin-bank.io merely added fake names to the pictures, after stealing them from other websites.

A “cryptocurrency bank” or just another scam?

While some cryptocurrency-related services could, in a certain way, be seen as cryptocurrency banks, Bitcoin-bank.io’s services seem to mimic those offered by Bitconnect. As reported by Core Media, Bitconnect shut down its lending and exchange platform, and saw the value of its Bitconnect Coin (BCC) plummet right after.

Although the company vowed to launch a new exchange later on, various disgruntled investors hit it with a class action lawsuit after losing over $770,000. Other scams saw investors put their money in fraudulent ICOs, that then just disappeared. A recent example even saw the scammers put actor Ryan Gosling as their graphic designer.

As reported, cryptocurrency fraud was one of Canada’s biggest scams last year. As such, regulators are seemingly eyeing the market to protect investors. As the FCSC warns:

“Becoming an informed investor is the best way to protect your money. Informed investors don’t leave it to chance. They understand the risks and costs involved with each of their investments.”