40% Of Financial Bars Offered Crypto In The Year Warned By CNMV

Cryptocurrencies have become one of the leading investment assets of the moment, despite their lack of regulation and a steep drop from the highs recorded in November last year. The rise of the retail investor following the pandemic and the promotion of social networks has supported the emergence of a battalion of new financial beach bars without the authority to invest in this type of property and provide investment services in Spain.

According to a list of “entities to be warned” by the market watcher, CNMV, digital assets have become the most offered investment product so far this year by financial beach bars in Spain, without permission to provide investment services. Businesses included. So far this year, 113 of the 281 companies on the regulatory list led by Rodrigo Buenaventura have traded cryptocurrencies in their businesses, accounting for 40% of the total. And 73 of them have them as their core product.

The second most popular product offered by these platforms is the foreign exchange (forex) market, followed by the platforms that offer derivative-like contracts (CFDs).

In recent years, the CNMV has stepped up its fight against financial sanctions and raised its warnings about the risks of cryptocurrencies. In fact, just a week ago it warned about holding a cryptocurrency macro-event in Madrid, Mundo Crypto, with several financial beach bars among its organizers.

Some of the warnings that began in 2018 when he partnered with the Bank of Spain warned of the extreme volatility, complexity and lack of transparency that make this type of business a high-risk bet. In March of this year, the European supervisory authorities – EBA, ESMA and Eopa – warned consumers about the “very risky and speculative” nature of digital assets, which they assured “are not suitable as investments or as a means. payment or exchange for most retail consumers ”.

Regulatory sources have indicated to this document that the high turnover of cryptocurrencies on the list could be a response to their popularity in recent years. However, they point out that the entity does not currently have detailed official data on the types of products offered by the entities.

Some of the entities the regulator has warned about so far this year are those offering up to 60% potential revaluation in 24 hours. This is the case of Trust-Finance Ltd., a firm that provides “professional brokerage advice” on investing in bitcoin through investment plans ranging from $ 15 to $ 500,000. On its website, it acknowledges that profits are not guaranteed and assumes no liability for damages and, by contracting with them, the client waives legal action or requests a refund from the Company or any of its members. IS. Indeed, they insist that “I am not a licensed bank or securities company”, that their services qualify as “private transactions” free from any regulation or insurance, and that the Commission is not entitled to any quotes. change at any time.

Most financial bars on the supervisor list offer more than one product. For example, they offer the ability to invest in cryptocurrencies alongside other high-voltage vehicles such as forex, CFDs, and commodities. Many of them present themselves as low-cost or free investment platforms or even mimic well-known investment brands, causing confusion for investors.

The more opaque services usually have foreign web addresses that do not end in the classic .com domain, for example in “.io”. The National Police has already warned that these types of domains can be used to detect potential scams, as they are also used for computer fraud, phishing. It is true that many web pages warned by CNMV stop working after the warning is issued, as their owners create similar addresses to continue offering their services.

most vivid example

Bot This is an application that claims to have up to 300 bots – automated accounts – that work “better than the real ones” and that claim to give monthly returns of up to 49% on investments. However, most of its users in the Google and Apple app stores give it the lowest score, claiming that the promised earnings are never met, that you often lose money, and that the withdrawal fees are too high.

MagicDAO. It is an organization that seeks to raise funds via tokens or NFTs to buy Cadiz FC and “give it back to fans”. According to his social media accounts, he met with investors to make the project possible.

TradeBlox. It is a predictive artificial intelligence company that has “educated” its neural network with historical market information to predict stock market movements. It promises 100% profit in 96 hours with a $ 30,000 deposit.

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