MARKET VOLATILITY COULD MEAN BIG LOSSES FOR WASHINGTON INVESTORS SEEKING BIG GAINS IN CRYPTO



Investing in the next generation of financial products or services comes with risk – at times significantly more than traditional investments.

OLYMPIA – The Washington State Department of Financial Institutions (DFI) reminds Washington consumers that investing in cryptocurrencies or cryptocurrency applications and platforms may be subject to extreme market volatility resulting in significant losses.

There have been several recent developments in the cryptocurrency space consumers need to be aware of. In times of extreme cryptocurrency market volatility, consumers investing in cryptocurrency or consumers placing funds on a cryptocurrency platform may have difficulty liquidating to cash. Further, during times of crisis, platforms may halt trading, which may prevent consumers from accessing their funds.

“Market volatility has led to company instability, huge investor losses, and significant regulatory actions,” DFI Director Charlie Clark said. “As with any investment, there are those whose cryptocurrency investments do well. There are also many whose do not, and others left with empty wallets when a company goes bust. Now, more than ever before, it is critical investors do their research before investing and understand the risks associated with the investments they choose.”

Additionally, the recent bankruptcies of two major companies have revealed that consumers holding accounts at these types of companies may be considered unsecured creditors. Investors also should be aware that funds held on cryptocurrency trading platforms are likely not insured by the FDIC. Recently, the FDIC issued a Fact Sheet clarifying when an account is considered FDIC insured.

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About DFIwww.dfi.wa.gov ▪ 360-902-8700 ▪ 877-RINGDFI (746-4334)

The Washington State Department of Financial Institutions regulates a variety of financial service providers such as banks, credit unions, mortgage brokers, consumer loan companies, payday lenders and securities brokers and dealers. The department also works to improve financial education throughout Washington through its outreach programs and online clearinghouse www.dfi.wa.gov/financial-education. In addition to posting information about licensees and administrative actions, DFI uses the Web and social media to provide financial education information: www.twitter.com/DFIConsumershttps://dfi.wa.gov/financial-education/bloghttps://www.youtube.com/user/WADFIwww.homeownership.wa.govwww.instagram.com/wastatedfi/www.linkedin.com/company/state-of-washington-department-of-financial-institutions/