articleStartImage

Canada’s Financial and Consumer Services Commission (FCNB) has decided to focus on cryptocurrency and blockchain teaching activities during this year’s Investor Education Month, the body said on Monday at the start of the initiative.

Virtual currencies like Bitcoin (BTC) have become very popular investment products, but people barely understand them despite the media coverage, FCNB explained. To be successful investors, people should know how various offerings work, what the opportunities and risks are.

Education Month has two main topics for crypto investor lessons. The first focus is bringing more awareness of the Initial Coin Offering (ICO) virtual coin crowdfunding model, especially on projects that offer tactics like free tokens or rewards for promoting the initiative on social media.

“Unlike an initial public offering (IPO), most ICOs are made without following formal disclosure requirements. As a result, it is often difficult to find out who is behind the ICO and how the money raised will be spent,” the agency explained in a statement.

The second topic is teaching people how to differentiate coin scams from legitimate and non-fraudulent crypto activities. If one digital asset project wants investor money as a condition to join the initiative, and making money depends on how many people the investors can recruit, this project is a “pyramid” and “illegal,” FCNB said.

“ICOs, cryptocurrencies and other digital assets are emerging investment products. However, they are extremely risky and can be fertile ground for fraud,” Erin King, the commission’s senior education and website officer said in a statement.

“We aim to provide investors with information about how to recognize a legitimate opportunity, and with the tools to make an informed decision about purchasing.”

According to the Better Business Bureau (BBB), digital currency-related scams debuted at fifth place on Canada’s top 10 list of money scams for 2017.

In July, the country’s central bank data showed a surge in people that hold Bitcoins as well as in general awareness of BTC.