The Commodity Futures Trading Commission (CFTC) of the United States recently issues another warning to consumers in which it is advising them to exercise caution and carry out comprehensive research before investing in digital currencies – even if they are ones advertised as utility coins or consumption coins.
The alert came in the form of a Customer Advisory warning posted on the CFTC website this Tuesday. It is the 4th warning released by the regulatory body when it comes to cryptocurrencies and digital assets.
The purpose of this notice, according to CFTC, is to enlighten potential investors about the existing risks and threats in the cryptocurrency market. It has a title “Use Caution When Buying Digital Coins or Tokens,” and with that, it encourages customers to thoroughly research all claims, especially the ones made by initial coin offering (ICO) promoters.
The Director of the Office of Public Affairs and Office of Customer Education and Outreach at CFTC, Erica Elliot Richardson, made an official statement about the new regulatory effort, stating:
“This advisory is part of the CFTC’s education and outreach efforts to help educate and inform market participants, who, given the pace of technology-driven change, will increasingly come in contact with new financial products and services. The CFTC’s Office of Customer Education and Outreach closely coordinates with LabCFTC in order to keep pace with developments in the markets the CFTC regulates, and we look forward to staying ahead-of-the-curve in providing customers the information they need to protect themselves against fraud or manipulation in the marketplace.”
So, what we can conclude is that CFTC’s latest advice is for investors to be wary of coins and crypto schemes that overpromise or guarantee future value or return. The customers, on the other hand, are advised to view any such advertising as an investment red flag.
Previously, the CFTC has put three different warning notices about cryptocurrencies, including a warning about pump-and-dump schemes through crypto exchanges as well as a warning about coins and schemes advertising themselves as “IRS approved”.
Crypto Exchanges In Bulgaria Are Investigated: Government Asks For 10% On Profits
Accounts Of The First Digital Bank In India Closed After Involving In Crypto-Related Activity
“I've been a user of DBS' Digibank for a year. Although I regularly used Kotak Mahindra Bank for my cryptocurrency transactions, I used Digibank only 7 times throughout the year. On January 14th, I received multiple messages from my twitter [sic] followers regarding an account closure notice by Digibank. I checked my mailbox and found the mail myself.”However, Digibank stated:
“Reserve Bank of India through their public notices have warned/advised the public regarding risks associated with virtual currencies. We reiterated the same vide our emails dated 4th May 2018 and 2nd Aug 2019, cautioning our account holders [against] the risks associated [...] and that DBS accounts and debit cards should not be used for their purchase or any kind of dealings.”Many other users responded to the allegations that not only Digibank but many other banks are doing the same as well.
BitMex Pulls The Plug On Trading Accounts In Quebec And The US
‘’The development comes at the same time as the Hong Kong-based company notifying users in North Korea, Iran, Syria, Cuba, Sudan and Sevastopol in the Crimea since the fourth quarter of 2018 against holding positions or trading on BitMEX, as these are restricted jurisdictions.’’It seems like BitMex only wants to cover its back and provide protection for their users against regulatory crackdowns. However, the exchange decided to pull the plug on the trading accounts after the Canadian regulatory body has announced the BitMex is operating illegally in Canada:
‘’BitMEX is not registered with the AMF and is therefore not authorized to have activities in the province of Quebec. We informed this company that its activities were illegal.’’There is still no explanation why the exchange decided to shut down the trading accounts in the US. Many believe that the exchange does so because of the same strict crypto regulations. We are still expecting a comment from BitMex since it seems like there is almost a billion dollars worth of crypto still on the platform.
The Revenue Agency Of Bulgaria Will Investigate Crypto-Selling Companies
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