As well, ASIC recently stopped the issue of a Product Disclosure Statement for a crypto-asset managed investment scheme.
Consistent problems identified by ASIC are:
Such problematic offers involve significant risks for investors.
ASIC Commissioner John Price said, ‘If you raise money from the public, you have important legal obligations. It is the legal substance of your offer – not what it is called – that matters. You should not simply assume that using an ICO structure allows you to ignore key protections there for the investing public and you should always ensure disclosure about your offer is complete and accurate.’
As outlined on MoneySmart, ICOs are highly speculative investments that are mostly unregulated, and while there are genuine businesses using this structure many have turned out to be scams.