3/24/2023 0 Comments Bitcoin expert hairThe 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 contrast with younger investors, those aged 55 or over remain resolutely on the margins with just 8 per cent of survey respondents in this age group trading digital currencies, the Charles Schwab study found. Today, they say, it is driven by demand from professional trading firms and institutional investors whose presence brings stability. Bitcoin bulls argue that the current rally is different from the 2018 bubble burst, when the price collapsed from above $16,000 to just $3,000. In the UK, millennial and Gen Z investors are more likely to buy cryptocurrencies than equities and more than half (51 per cent) of those surveyed had traded digital currencies, research from broker Charles Schwab shows.Īfter a year of spiralling prices, bears warn of the growing risk of a 2018-style collapse. Young people are in the vanguard of investing. 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.
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