Cryptocurrency fraud is the biggest threat facing investors From NASAA

The following is the Cryptocurrency fraud is the biggest threat facing investors From NASAA recommended by recordtrend.com. And this article belongs to the classification: Blockchain.

It is reported that the latest data from the North American securities regulatory Association (NASAA) show that investments related to cryptocurrencies and digital assets are the biggest threat faced by investors “so far”. “This year, the story of ‘cryptocurrency Millionaire’ has attracted some investors to try to invest in cryptocurrency or encryption related investments. With these situations, many people bet but lose. These stories will continue to appear in 2022.” Said Joseph P. Borg, director of the Alabama Securities Commission and co chairman of the law enforcement Commission.

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The annual survey of North American securities regulators urges investors to be cautious before buying popular, unregulated and volatile investment products, especially those involving cryptocurrencies and digital assets.

“The most common sign of investment scams is to ensure high risk-free returns. For investors, it is important to understand what they are investing in and who they are investing with,” said Melanie senter Lubin, chairman of the North American securities regulatory Association and securities Commissioner of Maryland.

“Education and information are investors’ best defense against investment fraud,” Rubin continued.

The survey report also said that digital assets “do not comply with the existing investor regulatory framework”, so the promoters of these investment products may be more likely to “deceive the public”.

Joseph rotunda, vice chairman of the law enforcement authorities Committee, said: “before you enter the cryptocurrency investment fever, be careful that cryptocurrency and related financial products may only be Ponzi schemes and other fraud faced by the public.”

Rotunda added that investment in cryptocurrency trading procedures, interest in cryptocurrency pools, cryptodepository accounts and securitized tokens should “see their essence: highly risky speculation and high-risk losses.”

According to the data of blockchain analysis company chainalysis, in 2021, swindlers obtained a record $14 billion in cryptocurrency, which is largely due to the rise of decentralized Finance (defi) platform.

Defi is a fast-growing field in the encryption market. It aims to separate banks and other intermediaries from traditional financial transactions (such as obtaining loans) by using blockchain technology.

The surge in theft and fraud led to a year-on-year increase of 79% in cryptocurrency related crime losses.

Fraud is the main form of cryptocurrency crime in 2021, followed by theft – most cases occur through hacker attacks on cryptocurrency enterprises. Chainalysis said that defi is an important part of fraud and theft, which is another warning for newcomers involved in this emerging field.

The North American securities regulatory association noted that many of the fraud threats faced by investors today involve private equity, which is not subject to federal legal registration requirements. U.S. states also have the right to give priority to the implementation of investor protection laws related to these private securities.

“Unregistered private equity is usually a high-risk investment product and does not have the same investor protection requirements as private equity sold on the open market,” Borg said

Finally, the state securities regulator said that if everything sounds too beautiful to be true, it may not be true.

For example, some defi platforms provide users with high returns, such as high interest rate savings and loan products.

Fraudsters usually attract new investors by promising safe, profitable and guaranteed returns in a relatively short period of time – “sometimes measured by hours or days rather than months or years,” the North American securities regulatory Association said. Such promises are a dangerous signal of fraud.

Fraud products related to promissory notes, money fraud on online and social media, and financial plans related to individual retirement accounts are the biggest threats faced by retail investors in the survey.

More reading: crypto head: cryptocurrency theft and fraud involved nearly US $3 billion in 2021. Bolt: cryptocurrency fraud increased by 90% year-on-year in 2020. FTC: since October 2020, Americans have lost more than US $80 million due to cryptocurrency investment scams, with a year-on-year increase of 1000%. Chain: Global cryptocurrency fraud caused losses of US $7.7 billion in 2021, up 81% coinmarketcap: August 2018 In January, the global market value of cryptocurrency fell to US $200 billion. In 2021, the cryptocurrency market inventory: bitcoin is still the overlord. Chainalysis: 2020 cryptocrime report McAfee: the number of cryptocurrency malware increased by 4000% in 2018. Juniper research: the cryptocurrency field is on the verge of collapse. Wanda: 40% of people plan to pay with cryptocurrency next year to deeply interpret the coindesk block in the first quarter Chain report: the cryptocurrency is in a bear market due to three factors Pew: the survey shows that 16% of Americans have invested, traded or used cryptocurrency card: more than one-third of cryptocurrency investors know little about cryptocurrency itself chainalysis: the transaction volume of cryptocurrency in Europe exceeds US $100 billion, becoming the largest cryptocurrency economy coingecko: the total market value of cryptocurrency exceeds US $3 trillion shut

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