Investing, Risks, and Scams

Investing in Crypto-Assets

Crypto-assets have become a frequently discussed topic in the context of investing, despite their relatively short history. As a new sector that carries a number of risks, consumers who plan to invest in crypto-assets should proceed with great caution. Before investing in crypto-assets, they should make sure that:

• They do not invest more than they can afford to lose.
• They understand the nature of crypto-assets and related products and services.
• They are well-informed about the risks associated with investing in crypto-assets.
• They do not invest under pressure or the influence of emotions.
• They maintain a diversified portfolio that does not consist solely of crypto-assets.
• They have a pre-defined investment plan and goal.
• They know how to securely store their crypto-assets and private keys.
• The issuer of the crypto-assets they intend to invest in is authorized to issue the given token.
• The crypto-asset service providers whose services they want to use are licensed in the EU.

Crypto-Asset Education

The National Bank of Slovakia, in cooperation with the 5peňazí project, provides educational resources on crypto-assets through the Crypto school project. The project is currently only in Slovak language.

Risks of Investing in Crypto-Assets

Crypto-assets are a high-risk investment. The most common risks include the prevalence of fraud, rapid price fluctuations, and currently still limited regulation.

Scams

Fraud is a part of the crypto-asset sector. The most frequent types are various forms of investment scams. These are often recognizable by warning signs such as promises of guaranteed returns or easy online earnings. Key red flags associated with most crypto-asset scams can be found, for example, on the website Scamafor (slovak language only).

To avoid falling victim to scams:

• Verify information on forums or within online communities.
• Check whether real people are behind the project.
• Be cautious of websites lacking key information or contact details.

The most common types of scams in the crypto-asset sector are briefly described in the articles below.

Rapid Price Changes (Volatility)

The prices of crypto-assets can change rapidly, often rising or falling significantly within a short period of time. While this volatility may result in high profits—as frequently highlighted in the media—it can also lead to substantial losses for investors.

Lack of Regulation

European Union is currently undergoing a change when it comes to the regulation of crypto-assets. This change started on 30 December 2024, when the Markets in Crypto-Assets Regulation (MiCA) came into effect. MiCA has introduced a harmonized legal framework across the EU for the issuance of crypto-assets, their trading, and the provision of related services.

However, it is important to note that MiCA does not eliminate all risks associated with crypto-assets. Just like in the traditional capital markets sector, investment risk in the crypto-asset sector is borne by the client. There is no such thing as a risk-free crypto-asset.

MiCA allows EU Member States to grant a 12-month transitional period (until 30 December 2025) to entities already operating in the crypto-asset space. The aim of this transitional period is to provide these businesses with sufficient time to align their operations with the new regulation and to obtain the appropriate authorization from the National Bank of Slovakia.

During this period, businesses that were providing crypto-asset services in accordance with applicable laws before 30 December 2024 may continue their activities without prior authorization from the National Bank of Slovakia.

Last updated on 25 Mar 2025