COLUMBUS, Ohio (WKBN) – State officials are warning Ohioans to be cautious when dealing with cryptocurrency.
The Ohio Department of Commerce announced Monday that it issued a license revocation order on Friday against West Realm Shire Servcies Inc. The company does business as FTX.
FTX stopped crypto trading on its exchange and “serious allegations of fraudulent conduct were raised,” according to the Ohio Department of Commerce.
FTX’s parent company and 100 affiliates filed for bankruptcy on Nov. 11. Investigators say it’s one of several exchanges that has filed for bankruptcy in 2022. The others are Three Arrows Capital, Voyager Digital, Celsius Network and Blockfi.
Some of the crypto exchanges have started offering financial products such as crypto-backed bank loans, allowing consumers to use their portfolio as collateral, however, state officials say the loans lack the same protections as traditional bank loans or investments. If the cryptocurrency or platform that provides the account fails, those assets aren’t insured.
Since Jan. 1, 2022, over 22% of incoming complaints for the Division of Securities involve some type of investment through cryptocurrency, according to the Ohio Department of Commerce.
If you have a cryptocurrency account, check the user agreement to make sure funds are available in the event of bankruptcy.