As it appeared in the Baltimore Sun (Subscription Required)
Partner Daren Firestone was recently featured in a Baltimore Sun article entitled “What is Cryptocurrency and How do I Avoid Scams When Investing?” where he shared his insights regarding what cryptocurrency is, what investors should know about digital currencies, and why they can be riskier than traditional investments.
Is Crypto a Digital Stock Market?
“There are digital markets, called exchanges, where you can buy and sell crypto. These markets are similar to stock markets. However, the question of whether crypto is similar to stock is a matter of great controversy. Courts have decided whether cryptocurrencies are securities [and stocks are a type of security] on a case-by-case basis […].”
Is Crypto Investing Risky? Why?
“Most crypto companies do not release audited financial statements Some do not reveal the identities of their executives. Some have no home offices. Many are located in jurisdictions where there is little recourse if your money is stolen […].”
Why Don’t You Need a License to Trade Crypto?
“Who qualifies as a broker-dealer under the securities laws and, therefore, must register with the SEC is another matter of great controversy that turns on whether cryptocurrencies are securities […].”
Why Does the Value of Crypto Change?
“The value of crypto, like anything else, is equal to what someone will pay for it. In general, people pay more for crypto when they think they will be able to sell it at an even higher price […].”
Can You Trace Where Crypto Investments Go?
“It is very difficult to trace crypto, especially when someone wants to cover their crypto tracks. To trace, you need to know how to use often complicated or expensive crypto tracing software […].”
Read the full piece here.
