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NASAA warns investors about crypto and ICOs

Yesterday, North American Securities Administrators Association (NASAA) issued a warning to Main Street investors regarding the risks associated with cryptocurrencies and initial coin offerings (ICO).

05.Jan.18 1:17 PM
By Daria Zaytseva


NASAA warns investors about crypto and ICOs

The warning was immediately followed by a statement by the Securities and Exchange Commission (SEC), in which the message of NASAA was approved and confirmed. The statement of NASAA contains a list of common problems related to cryptocurrencies and warnings about the high potential of fraud when investing in them.

The NASAA and the SEC mentioned how cryptocurrencies are different from "traditional", or fiat, currencies. Both agencies noted that it is these differences that make cryptocurrencies highly risk.

Finally, the application ends with a list of five potential signs of fraud when investing in crypto space. These red flags with falsifications include "guaranteed" high incomes, unlicensed sellers and high pressure to buy quickly, all of which may have been present in most ICOs in 2017.

The SEC affirmation on NASAA statement - along with several other SEC statements on crypto and ICO indicates an increasingly concentrated focus on the regulation of crypto space, especially in the U.S.

As the cryptocurrency market continues to grow and public attention increases, the potential risks for new, uninformed investors are likely to stimulate regulation and warnings from public authorities around the world.

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