Swiss financial regulator FINMA has closed down three companies linked to a fake cryptocurrency called E-Coin and also launched probes into other possible fake cryptocurrency providers.

The regulator said that QUID PRO QUO Association had been issuing a fake cryptocurrency named E-Coins since 2016, in association with Digital Trading and Marcelco Group.

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The regulator alleged the firms of accepting funds worth at least CHF4m through the platform and operating virtual accounts for several hundred users, even after failing to secure the necessary authorisation.

E-Coins were stored on local servers unlike real cryptocurrencies that are stored on distributed ledgers, the regulator noted.

The watchdog has now launched bankruptcy liquidation proceedings against the three entities.

Suspecting similar foul play, the regulator has also put Suisse Finance, Euro Solution and Animax United on its warning list.

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At the same time, it has launched 11 probes into other suspected business models involving coins.

Several other regulators have cracked down on cryptocurrencies in the recent times to mitigate risks in the financial system. While UK’s Financial Conduct Authority, US Securities and Exchange Commission, Securities and Futures Commission of Hong Kong, South Korea Financial Services Commission warned on the risk of ICOs, People’s Bank of China termed ICOs as illegal and ordered an immediate ban on related fundraising activities.