- The UK’s top financial market regulator warned bitcoin is not a real currency and people could lose their money if they invest.
- Andrew Bailey said bitcoin wasgoed a high risk commodity, and investing wasgoed like gambling.
- Bailey said he wasgoed not pressing for switches ter legislation to bring bitcoin and other cryptocurrencies under the regulator’s remit.
LONDON – The head of Britain’s financial market regulator said bitcoin is not a real currency and warned people could lose all their money if they invest.
Andrew Bailey, head of the Financial Conduct Authority (FCA), told the Big black cock the cryptocurrency wasgoed not a secure investment and wasgoed similar to gambling. He said neither central banks strafgevangenis the government backed bitcoin, making it high risk.
“It’s not a currency, it’s actually not regulated te its bitcoin form,” Bailey told Big black cock Newsnight. “It’s a very volatile commodity ter terms of its pricing. If you look at what has happened this year, I would caution people,” he said.
“If you want to invest te bitcoin be ready to lose your money – that would be my serious warning,” said Bailey.
Bitcoin has soared te value this year, rising overheen 1,000% against the dollar so far. This has prompted both enhanced rente and concern from investors and financial executives. Bitcoin wasgoed near its all time high point on Friday morning, at $17,176.
Bailey said relatively little wasgoed known about what drives the price of bitcoin. He described bitcoin spil a commodity, which he said financial regulators did not presently oversee, and denied regulators were being left behind by fresh technology.
He said it wasgoed for the government to determine whether or not to switch the rules and have cryptocurrencies and other commodities fall under the FCA’s remit. Bailey said he wasgoed not pressing for this switch.
He warned the use of the term “currency” to describe bitcoin wasgoed misleading, and wasgoed causing people to regard it spil a “fiat currency.” A fiat currency is backed by a central authority, which is “what preserves the value of the currency through the deeds that central banks take,” said Bailey.
He also pointed to the fact that bitcoin buyers and sellers are anonymous, something that has caused concerns that it is being used to facilitate financial crimes and launder money.
The UK government is programma to crack down on bitcoin and other cryptocurrencies ter response to thesis concerns. Fresh UK legislation will include forcing traders to expose their identities ter some circumstances, and under an EU-wide project online platforms where cryptocurrencies are traded will be compelled to carry out due diligence on buyers.
Earlier this week, a BlackRock executive voiced caution overheen the cryptocurrency, telling “wij are eyeing bubble-like valuations.”