Reuters: Crypto Reviews Are Not Objective

Reuters: Crypto Reviews Are Not Objective

Did you know that social media personalities charge thousands of dollars for positive coverage of cryptocurrencies?

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Did you know that social media personalities charge thousands of dollars for positive coverage of cryptocurrencies?

Investors should be critical towards every information they receive when it comes to cryptocurrencies` reputation.

Why? Because Crypto issuers tend to pay for positive ratings from research houses and celebrities, according to a report published by Reuters.

Is Crypto a Bubble?

Cryptocurrencies have appeared on the financial scene with the huge promise of democratization and decentralization of the financial market. But virtual currencies are facing trust issues, finding it hard to convince regulators and investors that they are worth investing in.

It is, therefore, logical to doubt most digital currencies issuers. Are cryptocurrencies too volatile to trust?

For example, bitcoin, the biggest and perhaps most popular cryptocurrency, has recently witnessed an unexpected decrease in its price. The bitcoin price is amounting to the modest sum of $3,749.27 as of 27 November, according to coinmarketcap.com. The digital currency has had better days with periods, in which it was worth above $20,000. It`s a big difference in value, explaining why it`s hard to trust the major cryptocurrency players.

ICO and Crypto reviews are not Reliable

Influencer marketing has become quite popular recently with celebrities getting cash for testing products and services and producing (positive) reviews about them.

However, when it comes to cryptocurrencies, the lack of disclosure might be a problem, at least according to the US Securities and Exchange Commission (SEC).

The SEC has published a report on its investigation into digital currencies and issued a warning saying that “virtual coins or tokens may be securities and subject to the federal securities laws.”

But that`s not all. The SEC issued a more specific warning about the promotion of online fundraisers known as initial coin offerings (ICOs) on November 1 last year. According to the warning published in a public statement on SEC`s website that was quoted by Reuters:

“Any celebrity or another individual who promotes a virtual token or coin that is a security must disclose the nature, scope, and amount of compensation received in exchange for the promotion.”

So, what`s the bottom line? Be critical and verify your sources. Nowadays, everyone is an expert (or claims to be an expert). If you`ve decided to make an investment, you should be 100% sure that the so-called experts you rely on are not doing it just for the money.

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