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New Jersey Orders Operator of Investment Pool in Bitcoin to Stop Selling Securities in the State

On February 9, 2018, the New Jersey Bureau of Securities issued an emergency order to stop the sale of securities by Bitstrade in the state.  Bitstrade is offering investors participation in an investment pool that purportedly will be invested in cryptocurrencies and guaranteed 10% returns.  The securities are offered to the public through a website.  The Bureau found that Bitstrade was violating New Jersey securities laws by failing to make certain key disclosures, including how investors funds would be invested.

The Attorney General of New Jersey, Gurbir Grewal, stated in connection with the order:  “The Bureau’s action today reinforces our commitment to protecting investors as they navigate the uncharted and largely unregulated domain of cryptocurrency-related investments, We want to make sure that investors tempted to cash in on the cryptocurrency rage aren’t being lured into sending funds to an anonymous internet entity without knowing where the funds are going or how they’ll be used.”

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