A new public service campaign is warning older investors of the risks of “crypto scams.” Despite less than 1% of all crypto activity being associated with criminal activity.
On Monday, the Securities and Exchange Commission (SEC) announced a new public service campaign to protect older investors. Resources available from the “Never Stop Learning” campaign from the Office of Investor Education and Advocacy (OIEA) include a video entitled “Red Flags of Fraud” which lists “crypto scams” as one of its warning signs to watch out for.
SEC Issues Crypto Warning
The mention of crypto here is the latest symptom of the SEC’s hostility to the technology. While crypto is far from crime-free, criminal activity makes up a small share of the broader crypto economy at less than 1%. Crime as a part of all crypto activity is also trending downwards, according to Chainalysis.
Learn how to stay safe when using and investing in cryptocurrencies: 15 Most Common Crypto Scams To Look Out For
“Older investors have years of life experience, and we want to encourage them to build on their experiences and knowledge to never stop learning about investing and fraud protection,” said Lori Schock, Director of the SEC’s Office of Investor Education and Advocacy, in an SEC statement.
“This year’s campaign, along with our new Never Stop Learning resource pages, provides vital information so that older investors have the tools and resources to safeguard their hard-earned money from fraud and abuse.”
Most people in the crypto industry are not criminals. However, when bad actors use crypto to defraud investors, the impacts can, admittedly, be devastating.
Earlier this year, a Canadian senior lost $7.5 million CAD to a sophisticated cryptocurrency scam, as per a CBC report. The fraudster gained her trust over several months through various channels. Then duped her into investing millions in cryptocurrency. She realized too late that she couldn’t withdraw her funds, and the person she was in contact with disappeared.
Although, it is worth noting that crimes of this kind do not necessarily need crypto to take place. In fact, with elders who are among the least confident about the technology, other means are often more efficient.
The news comes as the US regulator steps up its aggressive campaign against crypto. Last week, the SEC took the unprecedented step of suing the two world’s largest crypto exchanges, Binance and Coinbase, for securities law violations. Both exchanges deny the charges.
The agency has also branded multiple popular cryptocurrencies as securities. A controversial label that brings profound regulatory ramifications.
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