SEC director Lori Schock best advice for fresh Cryptocurency investors

Do you want to invest in cryptocurrency? Here are the top guide US Securities and Exchange Commission (SEC) Director of Investor Education and Advocacy, Lori Schock, has for you.

Though SEC investor.gov post clearly says that Schock’s post is not an investment advice on cryptocurrencies, but we consider some of her words inexpensive for those who want to take a plunge into crypto ‘ocean.’

 “You should understand if you lose money there is a real chance the SEC and other regulators won’t be able to help you recover your investment, even in cases of fraud.”

Schock said this because cryptocurrency investments do not fall under the SEC’s security protection laws. This means investors are doing so at their own risk; don’t invest what you cannot lose. SIMPLE!

Don’t fall for “high-pressure sales tactics

We’ve seen more than hundreds of ICOs coming up in the last three months, particularly since the beginning of era of bitcoin boom.

Early this year, one of the ICOs on Facebook was pushing potential investors to “quickly” make a purchase before the end of February as the price “will be doubled” and one of investor in the ICOs claimed to have lost the money he invested because “there’s no contact details on the website where I made purchase, and series of complaints posted on the Facebook Page of the ICOs got no response.”

“Don’t listen to celebrity endorsements as your basis for investment decision”

Celebrity endorsement has been one of the marketing tactics in the past, and that has also gotten to ICO sales and pre launch lately, “Just because your favorite celebrity says a product or service is a good investment doesn’t mean it is,” Schock said.

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Schock’s note to investors about celebrity endorsements comes the same week that “Zen Master” Steven Seagal announced his brand ambassadorship with Bitcoiin2Gen, a new coin that markets itself as “not an MLM company or a Pyramid Scheme or any Scam.”

Ask questions and demand clear answers,” about what exactly they are investing in, like “‘[w]ho exactly am I contracting with?’ and ‘[w]hat will my money be used for?’”

Don’t be over excited about large number of profits some people claim to make every month from cryptocurrency investment. Be inquisitive, simple.

Her last advice is:

“One way to spread risk is to diversify your investments.  Don’t put all of your eggs in one basket. That way, if one of your investments loses money, the other investments can make up for it […] Cryptocurrencies may be today’s shiny, new opportunity but there are serious risks involved […] most importantly, don’t flip a coin when you’re making investment decisions.”

Clearly put, only invest what you’re willing to lose, and diversify your investments to spread the risk.

The above advice by Schock came after a number of more serious statements from the SEC’s official website over the past year regarding the risks around Initial Coin Offerings (ICO).

And she has been visiting retirement homes where she’s been speaking with senior citizens about investing.

If you’re to invest in cryptocurrency which one will it be and why?

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