On March 1, the New York attorney general issued two alerts warning investors about the “extreme risk” facing New Yorkers investing in virtual or “crypto” currency. The first investor alert directs investors to take caution when investing in virtual currencies because, among other reasons, virtual currency trading platforms provide limited protection from fraud as “[m]ost platforms are subject to little or no oversight.” The second industry alert is directed towards broker-dealers, salespersons, and investment advisors, and provides a reminder that “people and entities dealing in virtual or ‘crypto’ currencies that are commodities or securities in the state of New York, and who do not qualify for an exemption, must register with the Office of the Attorney General,” and that failing to do so will expose them to both civil and criminal liability. The alerts follow an agreement entered last month (covered by InfoBytes here) between the AG and the operators of a virtual currency trading platform and a “tether” virtual currency issuer, along with their affiliated entities, which resolved allegations that the companies deceived clients by overstating available reserves and hiding $850 million in co-mingled client and corporate funds.