Get ready to lose everything. UK alert for cryptocurrency investors
In a document released on Monday, the UK Financial Conduct Authority stressed that anyone who invests in this type of asset must be prepared to lose all their money and expressed concerns about issues such as price volatility and the marketing of companies in the sector
Moacir DrskaMoacir Drska • 01/11/21 • 12h12
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In recent days, the price of cryptocurrencies has registered high volatility. After closing 2020 with a cumulative high of 305% and reaching its historic high of $ 41,900 last week, bitcoin, for example, operates in a sharp drop this morning, at $ 32,000, around 11:20 am
In the market, this scenario has resulted in a mixture of euphoria and concern about these assets. And that latest trend was reinforced on Monday with a statement from the UK Financial Conduct Authority (FCA).
In a statement, the FCA warned that investing in cryptocurrencies or in investments and loans linked to these assets involves high risks. And he stressed: "If consumers invest in these types of products, they must be prepared to lose all their money".
In positioning, FCA also points out that investors should be cautious if they are contacted from scratch, pressured to invest quickly or if "the promised returns seem too good to be true."
The agency stresses that, since Sunday, January 10, all companies that operate with cryptocurrencies in the United Kingdom must be registered with the FCA, in line with the anti-money laundering regulations. And he adds that operating without this registration is a crime.
Among other points of concern, the FCA lists issues such as price volatility, product complexity, the absence of investor protections in many cases, and the fact that many of these companies may underestimate the returns and risks involved in their equity actions. marketing.
"As with all high-risk speculative investments, consumers must make sure they understand what they are investing in, the risks associated with the investment and all applicable regulatory protections," wrote the agency.
The FCA statements come to light on a day of intense retreat for these assets. Taking all options into account, cryptocurrencies lost approximately $ 170 billion of their total market value on Monday.
The British regulatory body is not the only one to raise concerns about these assets. Last week, Bank of America released a note classifying bitcoin as the "mother of all bubbles".
In the report, bank analysts presented a graph that shows how the exponential appreciation of virtual currency compares to other bubbles in the market, such as dot-com companies in the late 1990s and the US housing bubble in the mid-decade. 2000.