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New York AG Issues Warning About Cryptocurrencies as Bitcoin Struggles to Recover

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Thu, 2/06/2022 - 20:07
New York AG Issues Warning About Cryptocurrencies as Bitcoin Struggles to Recover
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New York Attorney General Letitia James has issued an investor alert to investors to highlight various risks associated with cryptocurrencies.

James has noted that the cryptocurrency market experienced a massive correction last month that affected both well-established cryptocurrencies as well as new projects.

Cryptocurrencies may bring “more pain than gain” for market participants, she warns.

James singled out high volatility, theft, and fraud among the main risks.

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The American lawyer and politician also notes that investors may struggle to cash out their investment during a major market crash since cryptocurrency exchanges tend to halt trading due to technical difficulties.

She adds that buying cryptocurrencies may come with high transaction fees and hidden trading costs.  

Without directly mentioning the failed Terra project, Letitia also took aim at stablecoin. She claims that these cryptocurrencies are not actually stable, and their quality can vary greatly.

Finally, James also warned about conflicts of interest within the cryptocurrency industry, claiming some crypto exchange operators may make traders on their own platforms due to the lack of oversight.

Bitcoin is currently trading slightly above the $30,000 level after recently paring most of this week's gains.  

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