On 27 April 2022, the CSSF published a guidance for consumers in the context of virtual assets (the “Guidance”). In the context of digital communication channels promoting the possibility of high returns with virtual assets (the “VAs”), the Guidance reminds consumers of the potential risks of investing in VAs. It also underlines the fact that VAs are not necessarily a suitable investment for every type of investor.
Therefore, the CSSF invites consumers wishing to invest in VAs to read the relevant documentation, including the CSSF's warning on VAs and/or initial coin offerings (ICOs) and tokens, as well as the warnings from European supervisory authorities.
The Guidance aims to help consumers wishing nonetheless to invest in VAs by providing an outline of minimum steps to be performed before investing in virtual assets. First, consumers should educate themselves (for instance on Letzfin.lu) to better understand the relevant investment and its risks. Then, the CSSF advises consumers to invest through regulated or partially regulated entities offering VAs. However, risks remain, notably when such entity is located in a foreign country. Finally, the CSSF recommends checking information on such entities on their website and on that of the relevant competent authority.
Should you have any questions relating to the above, please do not hesitate to contact one of the experts of our digital assets team.