Cryptocurrencies burst into the investing mainstream in 2017 as the values of some virtual coins and tokens skyrocketed, led by Bitcoin. Mainstream media now feature daily coverage of new cryptocurrencies, coin exchanges, and related investment products. Stories of “crypto millionaires” have attracted some investors to try their hand at investing in cryptocurrencies or crypto-related investments. But stories of those who bet big and lost are now starting to appear.
Before you jump into the crypto craze, be mindful that cryptocurrencies and related financial products may be nothing more than public facing fronts for Ponzi schemes and other frauds. And because these products do not fall neatly into the existing federal/state regulatory framework, it may be easier for the promoters of these products to fleece you. Investing in cryptocurrencies and related financial products accordingly should be seen for what it is: extremely risky speculation with a high risk of loss.