BITCOIN PRICE WARNING: EU regulator says investors could lose EVERYTHING
BITCOIN investors are being warned its price could plummet and never recover, in an alert from the European Union’s chief market watchdog.
By REBECCA JONES
Express.co.uk
Tue, Nov 14, 2017
The European Securities and Markets Authority said investors should be wary of participating in initial coin offerings (ICO’s) of cryptocurrency, including Bitcoin, as their price fluctuates wildly.
In a statement issued on Monday, The regulator said: “ESMA is alerting investors of the high risk of losing all of their invested capital as ICOs are very risky and highly speculative investments. The price of the coin or token is typically extremely volatile and investors may not be able to redeem them for a prolonged period.”
In an ICO a business or individual issues coins and puts them up for sale in exchange for hard currencies, such as the pound or US dollar, or more often virtual currencies including more Bitcoins, or rival Etherium.
ESMA said as ICOs currently fall outside the scope of EU laws and regulations investors are particularly exposed while ICOs are vulnerable to the risk of fraud or money laundering.
The pronouncement follows a rollercoaster weekend for the price of Bitcoin, which tumbled from $7,325.36 (£5,597.31) on Friday to a low of $5,617.69 (£4,292.48) on Sunday as the creation of a new form of bitcoin – Bitcoin Gold – caused volatility.
The price had recovered somewhat to trade around $6,600 (£5,043) on Tuesday morning (GMT), buoyed in part by confirmation that CME – the world’s biggest derivatives exchange – would be issuing futures contracts on Bitcoin next month.
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