FINRA Issues Warning On Bitcoins

Under the title “Bitcoins: More Than A Bit Risky,” and with a URL that includes the words “fraud” and “scams,” FINRA has issued an investor warning about Bitcoins.

Briefly, the warning notes that risks of using Bitcoin include:

  • Bitcoin is not legal tender;
  • platforms that buy and sell bitcoins can be hacked, and some have failed;
  • transactions can be subject to fraud and theft;
  • deposits are not insured;
  • payments are irreversible; and
  • law enforcement could shut down or restrict the use of a Bitcoin exchange.

FINRA notes that Bitcoin transactions are highly speculative investments like real estate and gold and should be undertaken with care.

http://www.finra.org/Investors/ProtectYourself/InvestorAlerts/FraudsAndScams/P456458

 

About JeffKoeppel

I am a corporate/securities attorney in the Washington, DC area. Prior to joining the firm, I was a Senior Attorney Advisor in the Division of Corporation Finance at the U.S. Securities and Exchange Commission. I am a member of the Bars of the States of Maryland, New York and the District of Columbia. You can also follow this blog on LinkedIn at: http://www.linkedin.com/pub/jeffrey-a-koeppel/0/63/5a9
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