- Gary Gensler has issued a warning to crypto investors ahead of a Bitcoin ETF approval expected in a couple of hours.
- The SEC has also warned investors on Fear of missing out (FoMO) buying in anticipation of a price rally influenced by an approval.
With just a few hours to the SEC approving a Bitcoin spot ETF, SEC chair Gary Gensler has cautioned cryptocurrency investors on things to consider. As shared on 8th January, his statements have intensified discussions in the crypto community on the possibility that the SEC will approve a Bitcoin spot ETF on January 10th.
In a thread, the chair shared three things to remember when investing in cryptocurrencies. The chair warns investors about the firms offering crypto investments, and the need to confirm that they are compliant with the laws of the land. He further warns of the volatility and risky business involved with the industry. Lastly, he discusses the risk of rampant scams and fraud in the largely unregulated industry.
1. Those offering crypto asset investments/services may not be complying w/ 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 w/ their investment.
2. Investments in crypto assets also 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.
3. Fraudsters continue to exploit the rising popularity of crypto assets to lure retail investors into scams. These investments continue to be replete w/ fraud- bogus coin offerings, Ponzi & pyramid schemes, & outright theft where a project promoter disappears w/ investors’ money.
His warnings come just a couple of days before the SEC has to decide on whether to approve the multiple applications for spot bitcoin ETFs. Fox Business journalist Eleanor Terrett has pointed out that despite the SEC issuing additional comments on pending applicant’s S-1s which points to a delay tactic, those receiving these requests are not worried and remain fairly confident this is just part of the process to get everything in before January 10th.
Just spoke with a couple of people who received additional comments. They say they’re not worried and the @SECGov hasn’t conveyed a change of plans.
My sense is that they’re fairly confident this is just part of the process to get everything in before January 10th. https://t.co/B9PvuHo6yX
— Eleanor Terrett (@EleanorTerrett) January 9, 2024
Before Gensler’s post, the SEC had published had sounded the alarm on investors’ Fear of missing out (FOMO). The agency cautioned investors against getting caught up in market swings, trends, and influencers, and to show willpower in their investments.
Bitcoin (BTC) Hits 21 Month High
Amidst all the excitement, BTC has rallied to reach a 21-month high. At the time of press, BTC is up by more than 6% and trading at $46,856. With Bitcoin leading the market, its dominance has reached 50.8%.
The digital asset is now approaching a critical point. On one hand, if the SEC approves an ETF, the token will continue on an upward trajectory and easily retest its all-time high of $69,000 reached about two years ago.
On the other hand, the SEC could delay or reject the applications leading to price retracement. Investors will be watching the $40,000 support in the bearish case.
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