Late last year to early this year, there has been a lot of uprising investments over the internet in the Kenya Money markets.However,most of these have not been verified. One could objectively say most Kenyans are desperate to see their money grow or have a desire to get rich quick and this sometime does not matter on what market but on how profitable the market is. This has thus seen a huge rise in ICO such as Nurucoin and Uwezo coin this year.One may be quick to ask how genuine these investments are and why people rush to invest on them.
The Kenya Capital Market Authority (CMA) has now given a warning to investors with an urge that risk should first be considered before making an investment. The Authority went ahead to confirm that they have not approved any ICO and has therefore termed it as unregulated and speculative investments with great risk to investors.
ICO unlike other investments which offers shares, the coins offer investors tokens in return for their customers investments which makes it highly volatile. This also seems to be operating like most pyramid schemes and therefore offers no guarantee to the investors.
Among the reasons one may need to trend carefully on ICO includes;
- High risks of fraud due to unregulation. Most of these coins are unregulated by the Capital Markets Authority and therefore could highly result to fraud.
- There’s no legal requirement for the market. This simply means that you cannot sue an investment company in case of fraud.
- Lack of tangible evidence. this means that you don’t have any legal claim on the company in case of misfortunes or fall out. Most of these online companies can be easily dissolved.
It is important that before making any investments,thorough research should be carried out and risk assessed accordingly.