As part of Investor Education Month, the Canadian Securities Administrators (CSA) has warned investors not to be enamored by “flashy headlines about emerging businesses in areas such as medical marijuana, “green” energy or digital currencies.”
The CSA is an umbrella organization of Canada’s various provincial and local securities regulators. Similar to the Securities and Exchange Commission in the US, they seek to coordinate the regulation of Canada’s securities regulations and educate investors.
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Said Bill Rice, Chair of the CSA and Chair and CEO of the Alberta Securities Commission:
“Too often we see investors buying into the latest, greatest investment opportunity based on information that is light on details and promotes the investment as a ‘can’t miss’ opportunity. There is no such thing as a ‘can’t miss’ investment, and investors must take time to research the validity of the business, the risk factors involved and the investment’s suitability for meeting their personal finance goals.”
In addition to recommending investors to do research, research, and more research (they really should), the organization provides a tool to check the registration status and history of an entity offering investment opportunities. Digital currencies, however, remain outside the regulatory umbrella, save for the application of existing money transmission laws. Prospective investors in digital currency-related opportunities may have trouble finding relevant information and should supplement their research elsewhere.