Bitcoin and cryptocurrency regulation has been pushed into the limelight over recent weeks, thanks to social media giant Facebook’s high profile plans to launch its own potential rival to bitcoin sometime next year.
The bitcoin price, which had been climbing on rumors that big technology companies were taking an interest in bitcoin and cryptocurrencies, has plateaued at around $10,000 per bitcoin after a number of countries rebuffed Facebook’s plans, unveiled in June.
Now, the U.K.’s financial services watchdog has warned potential investors that bitcoin and cryptocurrencies have “no intrinsic value,” with some taking the caution as a signal the country could be moving towards a bitcoin ban.
“This is a small, complex and evolving market covering a broad range of activities,” said Christopher Woolard, executive director of strategy and competition at the U.K. Financial Conduct Authority (FCA), which oversees London’s huge banking industry.
“Today’s guidance will help clarify which crypto-asset activities fall inside our regulatory perimeter,” Woolard added, with the FCA warning: “Consumers should be cautious when investing in such crypto-assets and should ensure they understand and can bear the risks involved with assets that have no intrinsic value.”
The FCA branding bitcoin and cryptocurrencies as without “intrinsic value” is likely to rile many bitcoin believers who have long argued blockchain technology, which underpins bitcoin and most other cryptocurrencies, gives the digital tokens value.
“It is technically true that cryptocurrencies have no ‘intrinsic value’ when compared to share ownership in actual companies, however there are many examples where a marketplace bestows value on an intangible asset,” Jon Ostler, of comparison site Finder.com, told the U.K.’s Telegraph newspaper. “For example, the brand of ‘bitcoin’ itself has value and although its future place in society is still unclear, it is one of the most likely coins to stay the course.”
The warning from the U.K. comes shortly after U.S. president Donald Trump unleashed a scathing attack on bitcoin and cryptocurrencies, comments that were then echoed by other senior officials in his administration, including…
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