AG WARNS CT CONSUMERS AGAINST UNREGULATED CRYPTO

ATTORNEY GENERAL TONG WARNS CONNECTICUT CONSUMERS AGAINST UNREGULATED OVERSEAS DECENTRALIIZED FINANCE (DEFI) CRYPTO EXCHANGES

(Hartford, CT) – Attorney General William Tong today issued a comprehensive consumer alert warning Connecticut residents about the significant financial and security risks associated with unregulated, offshore “decentralized finance” (DeFi) cryptocurrency exchanges. Operating outside of state and federal regulatory frameworks, these platforms, including GMX, Gains Network, dYdX, Aevo, Drift Protocol, Vertex Protocol, and Hyperliquid, bypass critical consumer protections and expose retail investors to substantial financial losses, predatory leverage, and serious security risks.

“These platforms are built to lure investors in with promises of easy access and bigger returns. What they don’t advertise is that if something goes wrong, investors will be stranded with little to no recourse, while the platforms walk away with the profits. This isn’t innovation, it’s exploitation. Do research before handing over any money and know what protections are in place if things go wrong,” said Attorney General Tong.

“Unregulated offshore crypto platforms pose serious financial as well as other hidden risks to Connecticut consumers” said Connecticut Banking Commissioner Jorge Perez. “These entities operate outside the safeguards that legitimate regulated financial institutions are required to follow, leaving investors dangerously exposed without protection. Decentralized or not, if a platform is evading U.S. oversight, consumers should assume they have no protections when something goes wrong. Before engaging with any crypto service, verify that it is properly registered and regulated. A few minutes of due diligence can prevent devastating financial losses.”