The Texas State Securities Board (TSSB) recently published the tenth-anniversary edition of its investor guide, which contained a list of risky investments—cryptocurrency included—that people should be wary of.
In its “Texas Investor Guide: Strategies for Investing Wisely and Avoiding Financial Fraud,” the state regulator said cryptocurrencies require scrutiny and should be traded with care. Aside from crypto, the list also includes unregistered individuals, oil and gas offerings, and promissory notes.
According to the TSSB, digital assets are extremely volatile and that it’s almost impossible for a layman to understand how it works. Promoters of crypto tokens are also just trying to take advantage of people looking for a way to get rich quickly, the board says, noting that even seniors and retirees who prioritize security over speculation have ended up investing in ICOs.
Word of advice from the regulatory body
The TSSB has some pieces of advice for investors on how to deal with cryptocurrencies. The state board warned investors to refrain from buying cryptocurrencies without knowing the trustworthiness of the token-issuing firms.
“Any investor who does decide to enter the crypto space should only deal with registered firms,” TSSB advised. Further emphasizing that very little that can be done for investors that lose their funds through ICO or other crypto-related investments.
Additionally, the regulatory explained that investing in such cryptocurrency offerings leads to investors transferring funds to anonymous third parties.
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