Cryptocurrencies Are Risky Says The European Union

Cryptocurrencies Are Risky Says The European Union

European Union regulators are reluctant to embrace cryptocurrencies. The European Supervisory Authorities warned the public that cryptocurrency trade along with initial coin offering are unregulated activities that pose a serious financial threat.

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European Union regulators are reluctant to embrace cryptocurrencies. The European Supervisory Authorities warned the public that cryptocurrency trade along with initial coin offering are unregulated activities that pose a serious financial threat.

ESA is worried that many people invest in digital assets without educating themselves properly. The EU regulator notes “The ESA warn consumers that VCs (virtual currencies) are highly risky and unregulated products and are unsuitable as investment, savings or retirement planning products.” According to the authorities, not everyone involved in the crypto trade is familiar with the potential risks, which may cause loss of gross sums of money.

Every potential investor should take notice that since cryptocurrency trade and initial coin offerings are unregulated, the law cannot protect consumers in case of fraud or cyber-attacks. Furthermore, the high volatility of cryptocurrencies makes them inappropriate for savings or retirement planning. The European Supervisory Authorities for securities, banking, insurance, and pensions state that bitcoin and every other altcoin show all signs of a bubble.

The European Union is joining a growing number of authorities warning the public over the hidden risks of crypto trade. So far, Japan, China, South Korea and Gibraltar are taking steps towards crypto regulation.

Unfortunately, the authorities have a right to be concerned because during the past months the crypto community went through hacked exchanges, hacked wallets, gunpoint theft, exit scams and malicious mining scripts among others. Culprits are familiar with the large sums of money involved in cryptocurrencies and are always one-step ahead of security providers.

Do your research and take care!

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