Cryptocurrencies and digital assets are the biggest threat to investors, according to new data from the North American Securities Administrators Association (NASAA).
The annual survey by the nonprofit association of regulators in the U.S., Canada and Mexico urged investors to be cautious when buying cryptocurrency and digital assets.
“The most common telltale sign of an investment scam is an offer of guaranteed high returns with no risk,” said NASAA President Melanie Senter Lubin in a statement. “The best defense is education and information are an investor’s best defense against investment fraud.”
Raiders set a record last year with $14 billion in cryptocurrency thefts as a result of the rise of decentralized finance (DeFi) platforms, according to Chainalysis’ blog, the New York-based blockchain analytics research company.
Researchers used data from North American securities regulators to identify the most problematic products, practices or schemes. Among the most cited scams include fraud offerings related to promissory notes; money scams available through social media and internet investment offers; and financial schemes connected to self-directed Individual Retirement Accounts.
In a warning to investors, NASAA said scammers are spoofing websites and using phony social media accounts to hide their identities. The trade group recommended investors should identify phony accounts by examining content, analyzing dates of inception and considering the…