232 Interactions, 2 today
The Bank of England advises crypto buyers to be cautious of the dangers involved with purchasing cryptocurrencies.
Andrew Bailey, governor of the Bank of England, has cautioned cryptocurrency holders about the risks of investing in the industry.
Speaking during a conference on Thursday, Bailey balked at the notion of “cryptocurrencies,” stating that “crypto assets” was a more suitable nomenclature for describing digital currencies.
The BoE governor espoused well-worn anti-crypto rhetoric, specifically the argument that cryptocurrencies lacked intrinsic value. “I would only emphasize what I’ve said quite a few times in recent years, [and] I’m afraid they have no intrinsic value,” Bailey added.
Delivering his stark warning to crypto investors, Bailey said:
“I’m sorry, I’m going to say this very bluntly again: Buy them only if you’re prepared to lose all your money.”
The comments of the Bank of England governor are strikingly similar to those of the United Kingdom’s Financial Conduct Authority. As previously noted by Cointelegraph, the FCA warned the British public in January of the possibility of incurring massive losses from crypto investments.
At the moment, the crypto industry was in the middle of a massive correction, with Bitcoin (BTC) slipping to $33,000. Since then, the gross crypto market capitalisation has almost tripled to more than $2.3 trillion.
Bailey’s remarks come amid a significant increase in crypto rates, particularly for altcoins, with Ether (ETH) setting a new all-time high. Vertical price movements have also occurred in major altcoins such as Polkadot’s DOT, Chainlink’s LINK, and XRP.
Despite the obvious lack of inherent worth, the governor of the Bank of England commented on the new craze, saying, “Now that doesn’t mean people don’t put value on them, because they can have extrinsic value.”
Dogecoin (DOGE), undoubtedly the quintessential “meme coin,” is up more than 12,700% year to date.
Though the governor of the Bank of England does not think much of the utility proposition of cryptocurrency, the country’s tax authorities are not excluding the risk of lucrative digital currencies being used to escape taxation.
Her Majesty’s Revenue and Customs revealed plans in April to beef up its policing of would-be cryptocurrency tax evaders in a way reminiscent of the US Internal Revenue Service’s “crypto question.”