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SEC Issues Warning to Bitcoin Investors

The US SEC has issued another caution for Bitcoin investors. The commission particularly warned about the dangers for BTC futures traders. They are obliged to “weigh carefully the potential risks and benefits of the investment.”

The bulletin named “Funds Trading in Bitcoin Futures” is in a long list of articles. These are specifically for cryptocurrencies and digital assets.

The SEC differentiated these schemes as non-legitimate investments. They are also citing to be concerns about the fraudsters that utilize Bitcoin to commit a scam. Additionally, the SEC claims that the exchange platform might also be a part of the illegal scheme.

The SEC’s last bulletin on BTC claims:

“Investors should consider the volatility of Bitcoin and the Bitcoin futures market, as well as the lack of regulation and potential for fraud or manipulation in the underlying Bitcoin market.”

Warnings by the SEC

SEC

The SEC elaborates that BTC is now a commodity in the US. Therefore, futures contracts should be traded with a “regulated and supervised” organization by the Commodities and Futures Trading Commission.

The regulator is also claiming that all platforms that offer this product to US citizens should comply with particular requirements.

“SEC is issuing this investor warning re onshore exchanges, which offer only about 2.5x leverage–just imagine how it views offshore exchanges offering >100x leverage.”

Caitlin Long, part of the state of Wyoming Blockchain Select Committee

As of now, BTC trades at $36,872. Funding rates across exchange platforms have flipped from positive to negative and vice versa in the last few days.

Therefore, the general sentiment in the market seems to be following a price action, there is no specific direction. In the short term, Bitcoin should re-acquire the higher area around the recent levels and the push towards the $40,000 price mark.

The SEC and the other US government officials and federal organizations have been giving the market a lot of negative announcements. The market has been susceptible to this news, however, it seems more immune to the effects.

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