CFTC Issued a Warning Against Crypto Fraud

The Commodity Futures Trading Commission of the USA issued a warning about cryptocurrency pump-and-dump schemes  
15 February 2018   268

The statement was published today. It includes the latest investor warning from the U.S. commodities and derivatives regulator. CFTC already put a warning that urged caution around investing in cryptocurrency retirement accounts earlier this month.

CFTC joined the other regulator, Securities and Exchange Commission (SEC). which also warned about pump-and-dump schemes around ICOs.

According to the official release, investors should do a research before potentially buying a cryptocurrency. The statement focuses on crypto promotion in social media. Investors should not buy crypto based on social media tips or sudden price spikes. It is important to distinguish hype from facts.

CFTC described the methods by which the pump groups manipulate members to drive prices. They are false news reports about partnerships with small company and investor who plans to pour millions of dollars into a small, lesser-known cryptocurrency or coin.

CFTC is going to seek enforcement actions against those who organize such groups.

20 % of University Students gain Cryptocurrency with Aid

The Student Loan Report along with Pollfish interviewed 1,000 university students with related loan debt
23 March 2018   157

It took them for 4 days to collect the data (from March, 16 till March, 20 of this year). All the participants were to ask the following question: Have you ever use student loan money to invest in cryptocurrencies like bitcoin?

The results were remarkable. The poll revealed that 21,2  % of current students with the loan debt have used aid money in order to fund a cryptocurrency investment. So, over one-fifth answered in the affirmative.

Drew Cloud, the leader of the Student Loan Report, clarified that the younger Americans are more active investors as they are rather optimistic about cryptocurrency. Therefore the students want to get involved in this subject in any way possible. Drew Cloud sincerely thought the percentage would be lower. He considers that any college student's budget is thin and limited, therefore some extra money may be used on rest, groceries, or books.

The Student Loan Report approved: student loan debtors would be to pull off such a manipulation as they are given their remaining loans to be used on “living expenses”. From time to time they borrow more than they end up needing for studies. College debtors`spending of the money is not officially tracked and this allows the leftover means to be spent in the way preferred by the student. Another important factor is loan debt payments often do not occur until after graduation, and generally 6 months after.

Mr. Cloud claimed that cryptocurrency was the most prevalent investment of 2017. The young Americans consider that digital money is a savvy way to spend their refund checks. Some students even suggest that they would be able to quickly pay their debts off (because “not long ago every virtual currency was experiencing seemingly unstoppable growth”).

A significant shortcoming from the survey are data concerning how much the average student of the university spent of their financial aid on cryptocurrency. It also would have been interesting to know what types of digital means students favoured.