- New York Attorney General Letitia James warns users about the cryptocurrency investment risks.
- The alert was issued as investors lost billions as the market reached its lows.
- She said that too often, crypto investments cause more pain than gain.
New York Attorney Letitia James issued an investment alert to investors citing the risks involved with cryptocurrencies. The warning follows a scenario that witnessed thousands of investors losing billions as the market touched its lows.
Attorney General James said:
Over and over again, investors are losing billions because of risky cryptocurrency investments. Even well-known virtual currencies from reputable trading platforms can still crash, and investors can lose billions in the blink of an eye.
Moreover, she mentioned that cryptocurrency investments often create more pain than gain. The Attorney General warned New Yorkers to be cautious before dumping their hard-earned money into crypto, as it can yield more anxiety than the fortune that it might bring.
The warning doesn’t come as a surprise as the cryptocurrency market went through turmoil last month. With the fall of Terra and the bear market, many investors lost their life savings. The fall even brought down the trust that investors vested in cryptocurrency.
While investors do tolerate the bear market as it is considered an opportunity to stack more crypto, the fall of Terra was entirely unexpected by many. But the catastrophic fall of the Terra ecosystem did make investors more cautious.
Apart from the general warning, the press release also highlighted other issues that cryptocurrency investors may face. This includes highly speculative value, trouble cashing out, high and hidden transaction costs, unstable stablecoins, etc.
The warning by the Attorney General highlights her efforts to regulate the cryptocurrency sector to protect investors. James had also issued a notice earlier this year to cryptocurrency investors asking them to pay taxes on their virtual currency investments accurately.