The North American Securities Administrators Association is warning investors about the strong potential for scams in the metaverse.

The organization, which represents state and provincial securities regulators in the United States, Canada and Mexico, issued an Informed Investor Advisory Wednesday that the lack of regulation in the metaverse — combined with the ability to operate from anywhere in the world — makes it easy for criminals to prey on unwary investors.

While the metaverse may offer various potential investment opportunities, including virtual real estate and nonfungible tokens, the NASAA said investors should know that, just like with physical-world investments, promises that sound too good to be true often are.

“Our experience with so-called investment opportunities found in the metaverse, is that we see the same old financial scams simply dressed in new clothes and offered to investors in the metaverse. Investors need to be wary of any investment that is promising unrealistic returns with minimal risk," NASAA President and Maryland Securities Commissioner Melanie Senter Lubin said in a statement.

Also, security lapses on some platforms, as well as the possibility of fake metaverse experiences can lead to hacks, fraud or the theft of users’ funds, NASAA warned.

Though major tech companies such as Meta (formerly known as Facebook) are investing in the metaverse, the concept is still evolving as a somewhat nebulous collection of virtual online spaces. Proponents assert that the metaverse will be the future of gaming, shopping and human interaction. Despite using real estate nomenclature to describe metaverse properties, the connection between developing physical properties and developing metaverse spaces isn't clear.

Investment in the metaverse began in earnest this year, with a springtime boom in virtual land sales on different platforms. They have dropped precipitously in the months since — values were down 80% in June from their peak four months earlier, and activity on some platforms was down by as much as 97%, The Information reported.