New Disclosure Rules Enhance Crypto Investor Protection

Amid concerns that many investors may not fully understand the risks associated with virtual currencies, or the limits of regulatory oversight, the National Futures Association (NFA) recently issued an interpretive notice titled Disclosure Requirements for NFA Members Engaging in Virtual Currency Activities. Here is what you need to know about the new rules and how they might impact you as a market participant or a customer.

1. Which products does the notice apply to?

The notice is aimed at virtual currency derivatives, such as futures, options and cleared swaps. The NFA stated these products “have a variety of unique and potentially significant risks” that are often misunderstood by customers, including the substantial risk of loss.