Over the last few financial years we have seen some instances of SMSF trustees losing their crypto asset investments.
These losses have been caused by:
- crypto scams, where trustees were conned into investing their superannuation benefits in a fake crypto exchange
- theft, where fraudsters would hack into trustees crypto accounts and steal all their crypto
- collapsed crypto trading platforms, many of whom were based overseas and
- lost passwords resulting in trustees being locked out of their crypto account and being unable to access their crypto.
Trustees thinking of investing in crypto need to be aware of the ways that crypto can be lost, including via scams and how they can avoid them. ACCC's scamwatchExternal Link and the MoneySmart section on ASIC's website has some useful information on how to spot scams, including crypto scamsExternal Link and what to do if you've been scammedExternal Link.
Many crypto assets are not commonly considered to be financial products. This means the platform where you buy and sell crypto may not be regulated by ASIC. So you may not be protected if the platform fails or is hacked. When a crypto platform fails you will most likely lose all of your crypto.
You can also check out our short Crypto myth busting videos:
- SMSFs investing in cryptoExternal Link – reminds you of your regulatory obligations you need to meet when investing in crypto assets
- Lost access for my cryptoExternal Link – provides details of how your SMSF may be able to claim a capital loss in situations where you lose your password or your crypto is stolen.