The U.S. Financial Industry Regulatory Authority (FINRA) issued an investor alert on Thursday warning investors about the potential risks of participating in initial coin offerings (ICOs).

Recently, both the U.S. Securities and Exchange Commission (SEC) and the Canadian Securities Administrators (CSA) have published reports setting out their approach to ICOs, which typically involve companies raising capital through the issuance of virtual coins or tokens. In both cases, the regulators have indicated that, in certain cases, these sorts of offerings may be subject to securities laws, including disclosure and registration requirements.

Read: SEC warns investors about potential ICO scams

Read: Cryptocurrency offerings must comply with securities laws: CSA

FINRA’s alert reinforces the SEC’s conclusion that certain ICOs may be considered securities, even though they don’t provide investors with equity or debt stakes in the issuer.

Before investing in an ICO, investors should consider whether the specific ICO is a securities offering, the alert says, and, if so, whether it complies with securities requirements.

Among other things, the alert also advises investors to ensure that they understand the rights and benefits conferred by an offering, and the company’s plans. Investors should also consider the qualifications of the individuals involved in an offering.

“Investing in an ICO may seem like an exciting way to be a part of the virtual currency and blockchain startup markets, but buyers should use caution when considering these complex investments,” says Gerri Walsh, FINRA’s senior vice president for investor education. “ICOs involve new technologies and products that are highly technical and can be used by con artists as an opportunity to dupe investors.”