US SEC Issues Investor Alert on Encrypted Asset Securities

The U.S. Securities and Exchange Commission (SEC) has issued an investor alert urging investors to exercise caution when considering investments involving cryptoasset securities. The US SEC stated that investments in encrypted asset securities can be unusually volatile and speculative, and platforms where investors buy, sell, borrow or lend these securities may lack important protections for investors. The risk of loss for individual investors involved in transactions involving cryptoassets, including cryptoasset securities, remains substantial. Those offering crypto asset investments or services may not comply with applicable laws, including federal securities laws, the SEC said. Fraudsters use encrypted assets to lure retail investors to commit fraud, often resulting in large losses.