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New York Attorney General Warns on Cryptocurrencies as Bitcoin Rallies

new-york-attorney-general-warns-on-cryptocurrencies-as-bitcoin-rallies

New York Attorney General Letitia James warned investors to use “extreme caution” when buying cryptocurrencies and to watch out for scams following a recent run-up in bitcoin’s price.

Bitcoin’s value surpassed $50,000 this year, driven by institutional investors and companies that have bought the cryptocurrency.

Software developer MicroStrategy Inc., which acquired about $425 million worth of bitcoin last summer, said Monday it had purchased an additional $15 million worth of bitcoin at an average cost of $45,710 per bitcoin. Earlier this year, Tesla Inc. said it bought $1.5 billion in bitcoin.

The increased interest in cryptocurrencies and bitcoin’s recent rally has increased the number of bad actors—those who might use cryptocurrencies for fraudulent activities and investment scams—according to the New York attorney general’s office.

The office also warned brokers, dealers, salespersons and investment advisers that they must register with the Office of the Attorney General’s Investor Protection Bureau. Last month, the New York attorney general’s office sued to shut down an illegally operating cryptocurrency trading platform that it said defrauded investors out of more than $1 million.

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