CSA Advise Canadians to Ask Questions before Investing in Cryptos

The Canadian Securities Administrators (CSA) issued a warning on Friday targeting crypto investors who remind them to do their own diligence when researching this kind of investment. According to the CSA, Canadians should ask questions before investing in crypto assets.

The following questions were suggested by the authority when assessing the suitability of a crypto investment: “Does investing in this crypto asset align with my financial goals and time horizon? Do I understand what I am investing in? Can I afford to lose the money I’m willing to invest in crypto assets? Am I investing for the wrong reasons, such as fear of missing out, urgency from others, promises of guaranteed returns, exclusive offers and supposed cutting-edge investment opportunities? Have I considered the high-risk nature of investing in crypto assets and whether it fits my investor profile? Is the crypto asset I am considering deemed a security or derivative and subject to securities law? Does the crypto asset trading platform I plan to use hold custody of my crypto assets? Is it registered to do so?”

TikTok Campaign Also Deployed by the CSA

Also, the warning came accompanied by a bilingual campaign launch on TikTok by the CSA that encourages Canadian investors to ask themselves these questions in order to avoid any fraud whatsoever.

“The crypto landscape is evolving and complex. Fraudsters capitalize on market interest as well as a lack of knowledge in crypto assets to lure both sophisticated and potential investors into scams that can lead to devastating losses,” Louis Morisset, the CSA Chair and President and CEO of the Autorité des marches financiers, commented.

He added: “Asking questions, conducting research about potential crypto opportunities and making sure you deal with registered platforms are among the best ways to protect yourself from potentially fraudulent investment activities.”