Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 min to Learn more.
Investor Warning
Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
Warning for Investors
High-Risk Investment Notice from the Financial Conduct Authority (FCA)
Cryptocurrency investments are considered high risk, and you could face significant losses.The FCA views these investments as appropriate only for professional, accredited, or sophisticated investors who understand the risks involved and are financially prepared to handle potential losses. These products are not intended for retail investors.
Key Risks to Consider:
1) You could lose your entire investment
Cryptoassets are known for their extreme volatility. The value can fluctuate drastically, sometimes dropping as fast as it rises. You should be prepared for the possibility of losing your entire investment.
The market for cryptoassets operates largely outside of regulation, which increases the risks, such as potential losses due to cyber-attacks, financial fraud, or business failures.
2) You may not have protection if things go wrong
Additionally, the Financial Ombudsman Service (FOS) will not be able to handle complaints about firms dealing with cryptoassets. If something goes wrong, you won't have access to their support. Learn more about FOS protection here.
Cryptoasset investments aren't covered by the Financial Services Compensation Scheme (FSCS) because they don't fall under the UK's "specified investments" category. This means you won't be able to rely on FSCS protection if you lose money. You can check your investment's eligibility for protection using the FSCS checker.
3) You might not be able to sell when you need to
There's no guarantee that you'll be able to sell your cryptoassets when you want to. This depends on factors like market conditions and liquidity at the time.
Operational risks like system failures, cyber-attacks, or issues related to fund management could delay your ability to sell assets, leaving you stuck with your investment longer than anticipated.
4) Cryptoasset investments can be difficult to understand
These types of investments can be complex, making it challenging for investors to fully grasp the risks involved.
It's crucial to do your own research before investing. If something seems too good to be true, it probably is.
5) Don't put all your money into one investment
Concentrating all your investments in one asset class or market is risky. It's better to spread your investments across different types to reduce your exposure to any single risk.
A good general rule is to avoid placing more than 10% of your total investments in high-risk assets, like cryptoassets. Learn more about spreading your risk here.
For more information on how to protect yourself and further details on cryptoassets, visit the FCA's website.