New York Attorney General Letitia James has warned about some of the risks associated with cryptocurrency investments.
New York Attorney General Letitia James has issued an investor alert to expose investors to the various risks associated with cryptocurrencies.
James mentioned that the cryptocurrency market experienced a massive correction last month which affected well-established cryptocurrencies as well as new projects.
He warned that cryptocurrencies could bring “more pain than profit” to market participants.
James chose high volatility, theft and fraud as the main risks.The US lawyer and politician also noted that investors may struggle to capitalize on their investments during a major market crash as cryptocurrency exchanges halt trading due to technical difficulties.
She adds that buying cryptocurrencies can come with high transaction fees and hidden trading costs.
Without directly mentioning the failed Terra project, Letitia also targeted stablecoins. They claim that these cryptocurrencies are not really stable, and their quality can vary greatly.
Lastly, James also cautioned about conflicts of interest within the cryptocurrency industry, claiming that some crypto exchange operators may lack the oversight traders create on their platforms.
Bitcoin is currently trading slightly above the $30,000 level, after recently turning down most of the gains this week.