Italy's financial regulator, CONSOB, issued a 90-day suspension on February 1st against the promotion of CoinSpace's cryptocurrency offering. The authority classified the offering as an unregistered financial product, making its marketing within Italy illegal.
CONSOB's investigation specifically targeted "coinspace1.com," a website marketing CoinSpace to Italian consumers. The regulator's findings mirrored concerns previously raised about CoinSpace's operational model. It identified advertised returns as high as 50% per month, alongside claims of daily returns. These payouts, typical of a Ponzi scheme, relied on funds from new investors rather than any legitimate business activity or cryptocurrency mining. Affiliates would invest in "S-Coin Ponzi points," with promised returns facilitated through an internal exchange.
Despite the ban, CONSOB faces a challenge in enforcement because the operators behind coinspace1.com remain anonymous. The website's registration uses a privacy service, concealing the identities of those responsible for its advertising content. When attempting to register on coinspace1.com, users are redirected to a replicated CoinSpace affiliate website. This redirection identified Danilo Presciutti, with affiliate ID 178996, as the referring member. Direct connections between Presciutti and the website's operation beyond this referral remain unclear.
As of the resolution's publication date, the coinspace1.com website continued to promote CoinSpace, seemingly disregarding the CONSOB suspension. Legal analyses, including one from TruffaCoin, suggest that CONSOB's resolution effectively renders all promotion of CoinSpace in Italy illegal, irrespective of the specific domain. CoinSpace itself has not publicly acknowledged the Italian regulatory action. Data from Alexa indicates Italy is the second largest source of traffic to the main CoinSpace website, suggesting a substantial base of Italian participants.
In a potentially related development, CoinSpace recently implemented Know Your Customer (KYC) verification procedures for its affiliates. While KYC is a standard anti-fraud measure in legitimate financial services, its introduction in an MLM context often signals financial distress for Ponzi schemes. Such measures frequently serve as a tactic to delay or restrict affiliate withdrawals, buying the scheme more time.
CoinSpace is charging affiliates a €119 EUR fee for this mandatory KYC verification. Affiliates who do not pay this fee are reportedly subjected to withdrawal limits. All required KYC documentation, including sensitive personal information such as passports and banking details, is directed to "KYC Safe." This entity appears to be a newly established Slovenian company, created on February 2nd, 2017, and seemingly dedicated exclusively to handling CoinSpace's verification process.