The U.S. Securities and Exchange Commission (SEC) is warning investors about the risks of investing in the top cryptocurrency.
In a new statement, the SEC expresses concern regarding mutual funds taking positions in Bitcoin futures.
As mutual funds seek exposure to Bitcoin, the SEC’s Division of Investment Management (IM) staff notes that it “will closely monitor the impact of mutual funds’ investments in Bitcoin futures on investor protection, capital formation, and the fairness and efficiency of markets.”
In addition, the IM recommends that a foray into the Bitcoin futures market should only be sought out by mutual funds that have in place strategies to mitigate risks involved in the sector and that those funds wishing to gain exposure to the market should issue warnings about the risks involved to their clientele.
Meanwhile, last week Gary Gensler, the newly appointed Chair of the SEC, said he believes many crypto assets currently on the market are actually securities and that the SEC has the authority to make that determination.