Enlarge (credit: Thomas Trutschel / Getty Images News)

The Securities and Exchange Commission issued a strongly worded warning on Wednesday about the risks of dealing with unregulated cryptocurrency exchanges.

“The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not,” the SEC statement said.

The announcement triggered a sharp selloff in cryptocurrency markets. Bitcoin’s value plunged 10 percent, from $10,600 to $9,500, in the hour after the announcement was posted. Ethereum, Bitcoin Cash, Litecoin, and other major cryptocurrencies all suffered significant losses.