As the Securities and Exchange Commission (SEC) is on the brink of approving a Bitcoin spot ETF, its chair, Gary Gensler, has issued a warning to cryptocurrency investors. His statements, made on January 8th, have sparked intense discussions within the crypto community about the likelihood of the SEC approving a Bitcoin spot ETF on January 10th.
In a thread, Gensler shared three key points for investors to bear in mind when investing in cryptocurrencies. He cautioned investors about the firms offering crypto investments, emphasizing the importance of ensuring these firms comply with the laws of the land. He also warned about the volatility and risk associated with the industry, and highlighted the risk of scams and fraud in this largely unregulated sector.
His warnings were as follows:
- Those offering crypto asset investments/services may not be complying with applicable law, including federal securities laws. Investors in crypto asset securities should understand they may be deprived of key info & other important protections in connection with their investment.
- Investments in crypto assets can be exceptionally risky & are often volatile. A number of major platforms & crypto assets have become insolvent and/or lost value. Investments in crypto assets continue to be subject to significant risk.
- Fraudsters continue to exploit the rising popularity of crypto assets to lure retail investors into scams. These investments continue to be replete with fraud- bogus coin offerings, Ponzi & pyramid schemes, & outright theft where a project promoter disappears with investors’ money.
These warnings come just days before the SEC is due to decide on whether to approve multiple applications for spot bitcoin ETFs. Despite the SEC issuing additional comments on pending applicant’s S-1s, which some interpret as a delay tactic, those receiving these requests are not concerned and remain confident that this is just part of the process to get everything in before January 10th.
Prior to Gensler’s post, the SEC had already sounded the alarm on investors’ Fear of missing out (FOMO). The agency advised investors against getting swept up in market swings, trends, and influencers, and to exercise willpower in their investments.
Amidst all this, Bitcoin (BTC) has rallied to a 21-month high, trading at $46,856 at the time of press, with a market dominance of 50.8%. The digital asset is now at a critical juncture. If the SEC approves an ETF, the token could continue its upward trajectory and potentially retest its all-time high of $69,000 reached two years ago. However, if the SEC delays or rejects the applications, this could lead to a price retracement, with investors keeping a close eye on the $40,000 support in the bearish case.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Gary Gensler, Eleanor Terrett |
| Companies | Fox Business, Securities and Exchange Commission |
| Currencies | Bitcoin |
| Securities | None |
