The Slovenia Insurance Supervision Agency published an educational note and accompanying PDF guide on the risks of investing in cryptocurrencies, stressing that crypto investments can involve substantially higher risks than traditional assets and that investors should be prepared to lose their entire investment. The note highlights extreme price volatility in major cryptoassets and links market swings to macroeconomic factors, regulatory developments and market failures such as the collapse of the FTX exchange in 2022. It also points to widespread fraud and abuse, citing estimates of USD 14 billion in crypto linked to scams in 2021, as well as cyber risks including more than USD 3.2 billion stolen by hackers in 2021 and USD 602 million paid in crypto ransoms that year, alongside examples such as the 2017 NiceHash theft of 4,700 bitcoin. On the regulatory and investor-protection side, the Agency notes that the European Union’s Markets in Crypto-Assets Regulation began applying in 2025, introducing requirements including segregation of client assets, capital and liquidity requirements, and mandatory registration and supervision of crypto providers. It also flags that crypto exposures can generate losses for institutional investors, citing cases including Ontario Teachers’ Pension Plan’s USD 95 million loss linked to FTX and other pension-fund exposures tied to crypto-related firms and funds.
Slovenia Insurance Supervision Agency 2025-01-29
Slovenia Insurance Supervision Agency publishes crypto risk guide warning of volatility, fraud and limited legal recourse
The Slovenia Insurance Supervision Agency issued a note on cryptocurrency investment risks, highlighting higher risks than traditional assets and potential total loss. It details extreme price volatility, fraud, and cyber risks, citing significant losses like the 2022 FTX collapse and USD 14 billion in scams in 2021. It also highlights the EU’s Markets in Crypto-Assets Regulation, effective 2025, mandating asset segregation, capital requirements, and supervision of crypto providers.