In a joint statement, Banco de Mexico, the Ministry of Finance and Mexico’s Banking and Securities Commission (CNBV) have warned against cryptocurrencies and initial coin offerings (ICOs).

The authorities emphasize that virtual currencies are not backed by any monetary authority and do not constitute legal tender in Mexico.

With regard to ICOs, the statement said that depending on their characteristics the tokens issued via ICOs can be constituted as securities under the Securities Market Law. The authorities noted that there has been no record of issuance of ICOs in Mexico.

“However, depending on their specific characteristics, some ICOs that originate and are emitted in Mexico could violate the Markets and Securities Law and constitute a financial crime,” they said (as quoted by Reuters).

The authorities further cautioned that “investors with extensive experience” only should consider investing in ICOs and should make themselves aware of various aspects of the project including the business model and applicable legal framework. They emphasized (loosely translated):

“Consider ICOs as high risk investments, with the possibility of having losses up to the total of the investment ;

Be alert to signs or indications of fraud when investing in this type of products”

The warning comes at a time when the cryptocurrency market is witnessing explosive growth and breaking all records. At the time of writing, bitcoin is trading at $17150.