Launches a web page with tips, warning signs, and other information about cryptocurrencies and other crypto assets
OAK TREE – California Attorney General Rob Bonta today urged Californians to stay informed and protect their money when investing in the cryptocurrency market. In recent years, cryptocurrency has become popular as a form of digital investment and it is important to remember that the cryptocurrency market is highly volatile and there is no government guarantee or insurance for cryptocurrencies. To help Californians better understand cryptocurrency and the risks associated with their investments, Attorney General Bonta today launched a new webpage with information about cryptocurrencies and how to avoid scams and other pitfalls. More information is available at oag.ca.gov/crypto.
“From celebrities to your next door neighbor, it seems like everyone these days is investing in cryptocurrency based on the promise of quick and easy money,” he said Attorney General Goodness. “Don’t fall for a fantasy: Cryptocurrency, like all investments, carries significant risk and there is no guarantee you will see big or no returns. You should only invest money you are willing to lose, and you should be on the lookout for red flags and potential scams. Our new webpage is meant to be a resource for Californians curious about this new and volatile market, so skip the hype, get the facts, and visit oag.ca.gov/crypto.
Crypto assets include cryptocurrencies, tokens, coins, non-fungible tokens (aka NFTs), stablecoins — essentially, any form of purely digital asset. The values of cryptocurrencies are extremely volatile and buying or investing in them carries a very high degree of risk. When investing in crypto assets, you should not use money that you cannot afford to lose. Unlike money in the bank, there is no government guarantee or insurance for digital assets.
PROTECT YOURSELF: DO SOME RESEARCH
Often, your fear of losing something will make you more inclined to move fast and make a risky investment choice. Resist the urge: Always take a few days to consider whether you should actually go ahead with an investment or purchase.
State and federal regulators often issue warnings about common scams and other red flags they are seeing in the cryptocurrency space. Stay up to date with the California Department of Justice’s Cryptocurrency Webpage; the California Department of Financial Protection and Innovation Crypto Assets webpage; the Securities and Exchange Commission’s Crypto Assets and Cyber Enforcement Actions webpage; the Commodities and Futures Trading Commission’s digital assets webpage; and the Federal Trade Commission’s Cryptocurrency Consumer Advisory webpage.
STAY ALERT: WATCH RED FLAGS
Do some research before investing and look out for signs that an investment opportunity is too good to be true:
- Guarantees of great returns in exchange for money or cryptocurrency: If it sounds too good to be true, it probably is. Remember, there are no guarantees of great returns with cryptocurrencies.
- Token names similar to well-known cryptocurrencies: Scammers will use names for their tokens that are shockingly similar to cryptocurrencies like bitcoin and ether in hopes that you will assume their tokens are real or are associated with real cryptocurrencies. Look closely at the name and do a little research (especially on government agency websites like those listed in our “Tips for Staying Safe”) to see if the crypto asset is legit.
- Request payments in cryptocurrency: No legitimate company will force you to pay in cryptocurrencies or other crypto assets.
- Request large upfront payments: The requirement to pay a significant amount of money to participate in a particular money-making venture is a sign that you have been invited to a scam.
- Unsolicited phone calls or emails: Never give your account information to someone who calls you or sends you an unsolicited email, even if they claim to be from a legitimate company. Instead, hang up the phone or close the email, go to the company’s website and use the phone number or email on the website to contact the company.
- Celebrity Testimonials: Not all celebrity endorsements indicate that the underlying cryptographic asset is a scam, but it is important to remember that celebrities get paid a lot of money to promote these assets.
SUBMIT A COMPLAINT
If you believe you have been scammed or think someone is trying to scam you, file a complaint with state and federal regulators.
File a complaint with the California Department of Justice at oag.ca.gov/report. You can also file complaints with the following government agencies: