In a continued effort to bring clarity to cryptocurrency in Florida, Chief Financial Officer (CFO) Jimmy Patronis named Ken Lawson, president and CEO of VISIT FLORIDA, as cryptocurrency advisor. In this role, he will lead efforts to identity a cryptocurrency chief and collaborate with stakeholders to ensure innovation and economic development are at the forefront while getting ahead of potential fraud. [Read more…] about CFO Jimmy Patronis: Ken Lawson Named Cryptocurrency Advisor
Cryptocurrency
CFO Jimmy Patronis: SEC Right to Appoint Cryptocurrency Chief
Florida Chief Financial Officer (CFO) Jimmy Patronis released the following statement regarding the U.S. Securities and Exchange Commission’s (SEC) appointment of Valerie Szczepanik as the first cryptocurrency adviser. As Associate Director of the Division of Corporation Finance and Senior Adviser for Digital Assets and Innovation, Szczepanik will oversee how securities laws apply to emerging digital asset technologies, including Initial Coin Offerings and cryptocurrencies.
CFO Jimmy Patronis said, “The SEC’s appointment of a cryptocurrency chief is a forward-thinking and bold move. My office has been closely following cryptocurrency, and as with all emerging technology, there comes a new risk for consumers to be defrauded. With the Seminole County Tax Collector now accepting bitcoin as a form of payment and Tampa/St. Petersburg and Miami/Ft. Lauderdale ranking seventh and eighth in the top 10 bitcoin-friendly cities, it’s important we stay ahead of the game when it comes to consumer protection.
“Just last week my office issued a consumer alert on cryptocurrency investment scams. Today, I’ve directed my staff to set up a call with Associate Director Szczepanik to discuss how we can continue to protect consumers in our state.”
Consumer Alert from Florida Office of Insurance Regulation: Cryptocurrency
Initial Coin Offerings (ICOs) and cryptocurrency-related investment products have been identified as emerging investor threats for 2018. Cryptocurrencies are a medium of exchange that are created and stored electronically in the blockchain, a distributed public database that keeps a permanent record of digital transactions. Common cryptocurrencies include Bitcoin, Ethereum and Litecoin. Unlike traditional currency, these alternatives have no physical form and typically are not backed by tangible assets. They are not insured or controlled by a central bank or other governmental authority, cannot always be exchanged for other commodities, and are subject to little or no regulation. The Florida Office of Financial Regulation encourages Floridians to be very cautious of investments involving cryptocurrency.
Some common concerns investors should consider before investing in any offering containing cryptocurrency include:
- Cryptocurrency is subject to minimal regulatory oversight, susceptible to cybersecurity breaches or hacks, and there may be no recourse should the cryptocurrency disappear.
- Cryptocurrency accounts are not insured by the Federal Deposit Insurance Corporation (FDIC), which insures bank deposits up to $250,000.
- The high volatility of cryptocurrency investments makes them unsuitable for most investors.
- Investors in cryptocurrency are highly reliant upon unregulated companies, including some that may lack appropriate internal controls and may be more susceptible to fraud and theft than regulated financial institutions.
- Investors will have to rely upon the strength of their own computer security systems, as well as security systems provided by third parties, to protect purchased cryptocurrencies from theft.
Check out this video to help you understand the risks associated with ICOs and cryptocurrencies.
If you feel that you may be a victim of investment fraud or to report suspicious activity, please file a complaint with the Florida Office of Financial Regulation online, flofr.com, or call (850) 487-9687.
