NASAA Warns Investors About Cryptocurrencies

NASAA Warns investors regarding the risks associated with cryptocurrencies and Initial Coin Offerings (ICOs).

North American Securities Administrators Association(NASAA) published an announcement for investors, which warned of the danger of the cryptocurrencies, ICO, and other investment products. The head of the North American Association of Securities, Joseph P. Borg, said that investors should understand the risks:

Investors should go beyond headlines and hype to understand the risks associated with investing in cryptocurrencies, as well as futures contracts for cryptocurrency and other financial products in which these virtual currencies are associated with basic investments.

NASAA is the oldest international investor protection organization that unites regional regulators in the US, Mexico, and Canada. As the survey of members of the association showed, 94% believe that there is a "high risk of fraud" associated with cryptocurrencies. Regulators also were unanimous in the opinion that this market needs more regulation to protect investors.

Recent fluctuations in prices and speculation in investments related to cryptocurrencies can easily tempt unsuspecting investors to hurry with investments that may not be fully understandable for them. There is a high level of risk, unsatisfactory track record and high price volatility. In combination with the high risk of fraud, investing in cryptocurrencies is not for the faint-hearted.

The US Securities and Exchange Commission (SEC) immediately approved the NASAA warnings by publishing a statement , which also recalled the risks associated with cryptocurrencies and ICO. In fact, this was the second SEC statement on this topic; the previous one was published on December 11.

Regulators of the SEC and government securities are pursuing violations, but we again warn you: if you lose money, there is a significant risk that our efforts will not lead to the restoration of your investments

- says the SEC statement, which was signed by the head of the regulator Jay Clayton and commissioners Kara Stein and Michael Pivovar.

Recall that earlier the SEC made public proposals for changing the rules that could lead to the official launch of exchange investment funds (ETF) associated with bitcoin at the Chicago Stock Exchange (CBOE).

Information Source: Cointelegraph