Regulators across the globe are cautioning investors when considering investments in Initial Coin Offerings (ICOs).

The National Internet Finance Association of China last week warned the public against the risks posed by ICOs. Noting a recent surge in the number of ICOs in the country, it said (loosely translated):

“First, some institutions at home and abroad use all kinds of misleading propaganda means to ICO in the name of engaged in financing activities, the relevant financial activities without any permission, which is suspected of fraud, illegal securities, illegal fund-raising and other acts. The majority of investors should remain sober, vigilant, beware of being deceived. Once found to have involved in illegal acts, should immediately submit to the public security organs.

“Second, due to ICO project assets are not clear, lack of investor appropriateness, a serious shortage of information disclosure, investment activities are facing greater risk. Investors should be calm judgments, be careful to take their own investment risk.

“Third, China Internet Finance Association member units should take the initiative to strengthen self-discipline, to resist illegal financial behavior.”

This follows a recent warning by the Securities and Exchange Commission (SEC) against potential scams involving companies engaging in Initial Coin Offerings (or ICOs). In addition, the SEC, the Canadian Securities Administrators (CSA), and the Monetary Authority of Singapore (MAS) have recently issued guidelines on how securities law may apply to cryptocurrency tokens.

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