The United States Securities and Exchange Commission (SEC) has reiterated its cautionary stance on FOMO crypto investing, just days before the expected approval of spot Bitcoin exchange-traded funds. The SEC’s Office of Investor Education posted a warning on X (formerly Twitter) on January 6, highlighting the risks associated with digital assets such as meme stocks, cryptocurrencies, and nonfungible tokens (NFTs).
The “Say no go to FOMO” blog post first appeared on January 23, 2021, during a booming crypto and equities bull market. Bitcoin, Ether, and numerous other altcoins reached new all-time highs by November 2021. The warning was reissued around March 2022.
Speculation on social media suggests that the SEC may soon approve one or more spot Bitcoin ETFs, with a decision expected before a January 10 deadline. The warning also addressed the issue of celebrities and athletes promoting crypto assets, advising investors not to base their financial decisions solely on these endorsements.
The SEC stated, “You may see your favorite athlete, entertainer or social media influencer promoting these kinds of investment opportunities. Although it’s tempting, never decide to invest based solely on their recommendation.” The regulator has previously imposed fines and penalties on celebrities for promoting certain cryptocurrencies.
For instance, Kim Kardashian agreed to pay a $1.26 million settlement to the SEC on October 3 last year, after failing to disclose that she was paid $250,000 to promote a sham token called Ethereum Max (EMAX) to her 360 million Instagram followers.
The report also warned of the potential volatility of assets that are heavily influenced by “trends and influencers.” While these can initially seem attractive, losses can accumulate rapidly as the market moves on. The report posed the question to its readers, “How would you feel if your investment lost 20, 30, or even 50 percent in a single day?”
The crypto industry is currently closely monitoring the Bitcoin ETF space. Senior Bloomberg ETF analyst Eric Balchunas predicts that most applicants who met the regulator’s requirements before December 29 will be approved within the week.
This News Article was automatically generated by Bob the Bot (AI)
| Information | Details |
|---|---|
| Geography | North America |
| Countries | 🇺🇸 |
| Sentiment | neutral |
| Relevance Score | 1 |
| People | Kim Kardashian, Eric Balchunas |
| Companies | X (formerly Twitter), BlackRock, Bloomberg, United States Securities and Exchange Commission |
| Currencies | Bitcoin, Ethereum, Lido Staked Ether |
| Securities | None |
