Germany’s Federal Financial Supervision Authority (BaFin) has warned investors about the risks associated with investing in cryptocurrencies.

In a consumer protection warning posted on its website on Friday, the regulator issued a warning about retail investor interference in the cryptocurrency.

In its announcement, BaFin reflects similar comments from several European regulators, including the European Securities and Markets Authority and the European Banking Authority.

According to BaFin, retail investors should be aware of 100% risk of loss on their cryptocurrency investment.

While EU lawmakers are still working to create a nationwide set of laws for cryptocurrencies, German regulators already have some legal basis for the country’s digital assets.

Credit service providers, exchanges and other companies can only operate in Germany under the BaFin license. As Cointelegraph previously reported, the state legalized digital securities in December 2020.

Due to the fairly clear rules for cryptocurrency in Germany, some banks in the country have applied for permission to start offering cryptocurrency solutions.

In December 2020, the 224-year-old German bank Hauck & Aufhauser announced plans to create a cryptocurrency fund.

Despite these laws, BaFin said that private clients do not have protection against losses in the cryptocurrency realm, hence the warning.

Investment warnings in cryptocurrencies are a common phenomenon among financial regulators around the world, especially given the current bull market. In contrast to traditional QII financing, the cryptocurrency market offers simpler market entry channels for parent and investor investors.

In 2021 alone, regulators from South Africa to the United Kingdom and even Thailand will issue similar warnings. Last February, the Thai Finance Minister criticized the current speculative growth of the cryptocurrency and warned of the potential for heavy losses from private investors.

Meanwhile, the European Commission’s legislative proposal “crypto asset markets” continues to cause concern among industry stakeholders.

Earlier in March, the International Association of Trusted Blockchain Applications released a detailed report based on surveys and interactions with cryptocurrency industry players showing that some MiCA bases are hostile to the growth of startups.