CRYPTOCURRENCY CLAIMS

Mis-selling claims may arise where investors were advised to invest into a cryptocurrency that had been marketed as low risk. Cryptocurrencies are certainly not low risk and should not be promoted to the public or retail consumers.

Mis-selling claims can arise from: the mismanagement of cryptocurrency portfolios by financial advisors; disputed margin calls – closing an investors’ losing position without giving the investor adequate chance to add additional margin; and manipulation of cryptocurrency prices through tactics including ‘pump and dump’ (buying large quantities of a coin to artificially inflate its price in order to attract new investors before selling off) or the dissemination of false information.

Many crypto exchanges and platforms have moved beyond acting as mere crypto trading facilitators and now offer a wide variety of financial products. These financial products are generically referred to as derivatives but include things such as: crypto futures; crypto leverages; crypto options; lines of credit or borrowing. However, as the popularity of these products increase so does the number of investors who lose financially because of them. The potential losses are significant.