Setting their main focus on the high chances of fraud and exposure, the Capital Markets Authority (CMA) has warned the Kenyan people on the high risk involved when taking part in Initial Coin Offerings.
CMA went on to state via a notice, “There are ongoing invitations to members of the public to invest in such coins in what is being marketed as ‘pre-sale before the launch on public exchanges. While some ICOs are floated by entrepreneurs with genuine and innovative ideas for new products and services, there is a risk that some issuers could seek to perpetrate fraud against investors. Most ICOs operate solely over the Internet, and the fact that the products and sellers may not be subject to regulation exposes investors to fraud.”
Coming only second to the Central Bank of Kenya, the Capital Markets Authority is the second major financial regulator in Kenya to warn the citizens about the dangers of cryptocurrencies. They have warned that in the case of loss there is no fall back and that investing is a complete risk. These warnings have come amidst the release of the Nurucoin, a coin that was fully developed in Kenya by a native company.
To the Kenyan people, the CMA’s warning looks to be nothing more than a reaction to the Nurucoin. The minds behind the Nurucoin is an e-commerce platform known as Blazebay. They are a subsidiary of the Churchblaze Christian Association. The association runs a number of social and technology networking platforms.
Kenyan’s have not listened to any of the warning issued by the Capital Markets Authority. They view cryptocurrencies as a path that will get them to quick cash. That said, the Nurucoin is expected to be a big deal, one that will pull Kenyan further from the local currency. This is exactly what the government fears.