Consumers who invest in cryptocurrencies could well “lose all their money”, the UK’s financial regulator has warned, as the volatile Bitcoin price slides back from an all-time high of almost $42,000.
Bitcoin’s startling rise of more than 300% over the last year has captured the attention of the public and institutional investors alike. But the cryptocurrency is highly volatile, and dropped around 15% from a record-high of around $41,800 on Friday to $34,645 on Monday.
The mania for cryptocurrencies has also attracted the watchful eyes of financial regulators across the world. They worry that amateur investors could be sucked in, only for currencies like Bitcoin to collapse in value, as they did in 2018.
Britain’s Financial Conduct Authority (FCA) put it starkly: “If consumers invest in these types of product, they should be prepared to lose all their money.”
Regulators are attempting to tighten rules around cryptocurrencies, however. Since Sunday, the FCA has required all UK cryptocurrency firms to be registered with it as part of regulations to tackle money laundering.