The Insurance Commission warned both the public and the insurance companies against cryptocurrency transactions.
Insurance commissioner Dennis Funa said in a statement over the weekend while it recognized the value of technological advancement on the use of cryptocurrencies, the commission also noted the corresponding risks involved in the use of cryptocurrencies.
“Thus, the public is being cautioned to act prudently whenever dealing in the acquisition, possession, and/or trading of cryptocurrencies,” Funa said.
“The apparent increase in the demand for cryptocurrencies and its popularity in terms of usage as a medium for payment and remittances worldwide makes cryptocurrencies prone to being used for facilitating illegal activities, such as scams, money laundering, and terrorism financing,” said Funa.
Funa said as cryptocurrencies were neither issued nor guaranteed by any government, its value was purely dependent on market demand and supply made them highly speculative and not suitable for investment.
He said to minimize the risks involved in cryptocurrencies, IC cautioned the public and all IC-regulated entities to act prudently whenever dealing in the acquisition, possession or trading of cryptocurrencies.