New York’s attorney general issues a warning to digital asset investors, saying even well-described cryptocurrencies are extremely risky after last month’s market crash that saw the industry lose hundreds of billions of dollars in market capitalization.
In a new press release, New York Attorney General Letitia James says wild price swings, fraud, theft, security issues and speculative bubbles associated with digital assets all pose significant financial risks to Investors.
“Time and time again, investors lose billions because of risky cryptocurrencies. Even well-known virtual currencies from reputable trading platforms can still crash and investors can lose billions in the blink of an eye.
Too often, cryptocurrency investments create more pain than gain for investors. I urge New Yorkers to be careful about putting their hard-earned money into risky cryptocurrency investments that can produce more anxiety than fortune.
Other risk factors for crypto investors, according to the attorney general, include limited oversight, as she notes that digital asset exchanges are not federally regulated unlike the Nasdaq or the New York Stock Exchange.
James also says that holding stablecoins is risky, proven that these crypto assets are not 100% stable due to the nature of the assets that eventually hold them sometimes.
Another risk factor, according to James, is the tendency of crypto exchanges to pretend to have technical issues in times of accumulating.
“There is no guarantee that you will be able to liquidate your investments whenever you want – like when the crypto markets start crashing. In times of crisis, trading platforms may halt trading or claim to be experiencing technical difficulties, preventing you from accessing your assets.
The Attorney General also mentions hidden trading fees and the possibility of crypto exchanges prioritizing their own investments over the interests of their clients as additional risk factors for investors.
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NY Attorney General Sounds Alarm on Digital Assets, Says Crypto Creates More Pain Than Gain For Investors
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