Bitcoin is in the news again, this time because a New York hedge fund called NYSOhedge is taking investments in bitcoin, FINalternatives reports. While Bitcoin advocates might take this as another sign that the cryptocurrency is moving into the mainstream, a quick look at the NYSOhedge website gives the impression of a company that’s not exactly looking out for its customers.
NYSOhedge take Bitcoins, promises no risk
“NYSOHEDGE is an aggressive growth hedge fund by NY Stock Options with proprietary trading Technology, that utilizes our fund leverage to move any asset in any direction we choose. We get in and out at random before the market knows what hit it. There is NO RISK of losing invested principle because we HEDGE all investments. Our financial services and solutions experts specialize in aggressive growth funds,” the hedge fund writes on its website (emphasis theirs).
So the company invests at random, and tells prospective clients that there is no risk of losing principle (is that statement even legal?). If you’re wondering how much it costs to get in on this dream opportunity, accounts start at $25,000, and if you don’t have enough money, “We have margin loans that could have the $25k in your account in as fast as 30 min,” the company writes.
The pictures used on the testimonial page are stock photos, and we couldn’t find information for NYSOhedge or its parent company NY Stock Options in the FINRA broker database. When we called to ask for clarification we didn’t get an answer and the listed number isn’t set up to take messages, apparently.
The downside of anonymous transactions
While advocates love to talk about how Bitcoin transactions are anonymous and secure, this does bring up one of the downsides to using an electronic currency. If you send a payment and things don’t work out how you hoped, you don’t really have any recourse. Just proving that the transaction took place in a court of law could be challenging and if the recipient up and leaves, you won’t have any way to track them down.
If you’re thinking about making an investment and a few red flags come up when you’re doing your research, assuming you don’t immediately look for another brokerage, paying with Bitcoins doesn’t really seem like a good idea.