The bitcoin digital currency can expose people to significant losses, fraud and theft, and the lure of a potential quick profit should not blind investors to its significant risks, a brokerage industry watchdog warns.
In an investor alert titled ¡°Bitcoin: More than a Bit Risky,¡± the Financial Industry Regulatory Authority (FINRA) said Tuesday that recent events such as the bankruptcy of bitcoin exchange operator Mt. Gox have spotlighted some of the currency¡¯s risks.
¡°Speculators drawn to bitcoin trading should understand that bitcoin prices have fluctuated widely, and wildly,¡± said Gerri Walsh, FINRA¡¯s vice president for investor education. ¡°Investors looking to get in on the ground floor of a bitcoin-related company should realize that fraudsters may see the latest digital currency trend as a chance to steal their money.¡±
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