SEC Warns of Crypto ‘FOMO’ as ETF Hopes Grow with Web 3.0

Understanding the SEC Warning on FOMO Crypto Investing

The United States Securities and Exchange Commission (SEC) has reissued a warning about FOMO crypto investing — just days ahead of the anticipated approval of spot Bitcoin (BTC) exchange-traded funds. In a Jan. 6 post to X (formerly Twitter), the SEC’s Office of Investor Education again warned retail investors of the risks associated with digital assets, including meme stocks, cryptocurrencies, Defi, NFTs, DAOs, and Web 3.0.

The “Say no go to FOMO” blog post first appeared on Jan. 23, 2021, at the onset of a roaring crypto and equities bull market that saw Bitcoin, Ether (ETH), and many other altcoins reach new all-time highs by November 2021. The warning was re-emphasized in March 2022 when the markets were cooling.

The report has led several users across social media to theorize that the SEC is soon to approve one or more spot Bitcoin ETFs, with a decision expected before the Jan. 10 deadline.

To learn more about the risks and opportunities associated with Web 3.0, cryptocurrencies, NFTs, DAOs, and Defi, investors should take the time to understand the implications of these technologies and how to invest in them.

Crypto Assets and Volatility

The SEC has cautioned investors against making decisions based solely on the endorsements of celebrities and athletes, and has taken action against those who have promoted certain cryptocurrencies. For example, Kim Kardashian was fined $1.26 million for failing to disclose that she had been paid $250,000 to promote Ethereum Max (EMAX) to her 360 million Instagram followers.

Investors should also be aware of the potential volatility of crypto assets that are heavily influenced by trends and influencers. While these investments can be attractive initially, losses can quickly add up as the market moves past them.

With the emergence of Web 3.0, the use of DeFi, NFTs, and Daos has become increasingly popular. Learning about the differences between Web 2.0 and Web 3.0 and how to build a Web 3.0 website is essential for investors looking to benefit from the opportunities presented by Web 3.0.

“What would be your reaction if your investment suddenly dropped by 20%, 30%, or even 50% in a single day?” asked the report. This question is particularly relevant in the crypto industry, as everyone is eagerly awaiting the outcome of the Bitcoin ETF applications submitted before Dec. 29. According to Eric Balchunas, a senior Bloomberg ETF analyst, most of the applicants will likely be approved within the week.

Given the importance of web 3.0, many people are wondering how it is different from web 2.0 and how they can learn about it. They may also be interested in understanding how web 3.0 will work, how to build a web 3.0 website, and how it will affect businesses. Additionally, those looking to invest in web 3.0 should know the differences between web 2.0 and web 3.0, as well as the basics of Defi, NFTs, Daos, and web 3.0.