SEC Warns Investors of Risks Involved in Virtual Currency

SEC Warns Investors of Risks Involved in Virtual Currency The United States Security and Exchange Commission (SEC) has recently alerted investors to the risk in trading and using virtual currencies like Bitcoin.

The SEC released “Investments involving Bitcoin present unique risks” which states that governments and banks have no association with these virtual currencies and will not be covered by FDIC insurance resulting in unrecoverable losses.

The fraud risk is another issue specifically with Bitcoin investment schemes since the currency is so new that fraudsters do not yet fully understand the product and will be led by the "get rich quick" success stories.

The SEC recommends that investors thoroughly research virtual currencies and their markets prior to investing.
  • I have heard a little about Bitcoins but i am still not sure what the purpose of them is. Something new all the time.
  • I've seen on Reddit and around the internet that some people believe that investing in Bitcoins (holding onto them) is a legitimate way to guarantee a fund for retirement. Some people seem to think that Bitcoins have an intrinsic value, which will definitely rise on the whole over time. This is not true and it is the nature of these things to fluctuate, and probably to collapse completely eventually...

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