Yahoo Finance Australia’s Regulator Advises Against Investing Retirement Funds in Crypto
Amidst the growing crypto adoption by institutions around the world, regulators in Australia have warned residents against investing their retirement funds into the industry.
The Australian Securities and Investment Commission (ASIC) made this known in a publication released on its website.
Don’t Invest Your Retirement Funds in Crypto — ASIC
The warning became necessary due to several ads and marketing telling Australians to opt for self-managed superannuation funds (SMSFs) to invest in high return portfolios instead of the usual industry and retail superannuation funds that are common in the country.
With superannuation fund’s trustees being told to invest in cryptocurrencies like Bitcoin, ASIC has called on superannuation members to beware of falling victim to crypto scams.
In the release, the commission pointed out that setting up a self-managed super fund isn’t something to be done based on social media marketing and online investment opportunities. It called on anyone planning to set up an SMSF to first seek advice from a licensed financial adviser.
ASIC further outlined the risks of investing in crypto assets. It stated that anyone who sets up an SMSF would be personally liable for every decision and compliance even if they rely on advice of other people. It referred to previous publications on crypto scams and other relevant investments advice.
Why the Regulator is Sounding a Note of Warning
The release from ASIC isn’t surprising, given how important retirement savings are to the overall economy. Beyond the social safety net these funds provide for workers, they’re important to the financial industry.
Retirement savings account for a significant percentage of funds invested in the capital market. This means that people self-managing their funds and putting them into crypto will reduce how much money is available for investments in the traditional financial industry.
Beyond that, the risks of crypto investments mean investing in retirement funds can harm economic growth if such investments don’t go as planned. Several countries are already trying to regulate the crypto industry either directly or indirectly.
In UK, the Advertising Standards Authority has banned several crypto ads for being misleading or not providing enough information. International agencies such as the IMF have also called for consistent global crypto regulations.
This article was originally posted on FX Empire
