![]() Exchanges can turn out to be bogus and their founders disappear. It has not sought to block cryptocurrency dealings but has forbidden the sale of derivatives on crypto assets to UK retail customers.Īs crypto markets are unregulated, investors have no one to turn to for help if they fall victim to fraud. The Financial Conduct Authority, the UK’s financial watchdog, warned this year that investors can lose 100 per cent of their money when punting on cryptocurrencies. Investors globally have lost more than $16bn since 2012 in cryptocurrency-related scams and fraud, according to disclosure platform Xangle. In a recent (conventional) stock market flotation, investors valued Coinbase, the cryptocurrency exchange launched less than 10 years ago, at $72bn, putting it equal with BNP Paribas, a French bank with roots stretching back to 1848. Companies that operate in the digital currency sector are attracting a flood of money. Since the start of January, bitcoin’s value has risen by 85 per cent and in mid-April it hit the latest in a series of record highs at $65,000. Regardless of whether cryptocurrencies turn out to be the digital equivalent of gold in the long run, today they are providing fraudsters with a rich hunting ground.Ĭoinbase, the cryptocurrency exchange, which listed last month, was valued at $72bn © Michael Nagle/Bloomberg Even among these enthusiasts, many limit their investments to 1-2 per cent of their portfolio. But hardcore naysayers warn that a bubble that has grown bigger is still a bubble.Įven ardent crypto fans are reluctant to wager their life savings on an asset associated with hair-raising levels of volatility. ![]() The recent stellar performance has turned some bears into bulls. ![]() So is bitcoin just a big Ponzi scheme or a genuine investment opportunity? Should retail investors give in to the temptation to pile in? FT Money has spoken to finance professionals inside and outside the cryptomarket and found that opinion remains sharply divided. Recently emerged cheerleaders include Tesla chief Elon Musk and a number of billionaire hedge fund managers who are convinced that as the digital equivalent of gold, bitcoin’s exchange rate against conventional currencies has even further to soar. Jamie Dimon, chief of US banking giant JPMorgan, is just one prominent crypto bear who turned bullish in recent years. ![]() Eye-popping returns are making it difficult for even hardened cryptocurrency sceptics not to consider putting money into bitcoin and many long-term doubters are crumbling. ![]()
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