The FCA has been warning about Bitcoin for years, but is the real risk not investing?

One of the fewer fiscal regulators that person been accordant successful its warning astir the dangers of the crypto space is UK’s apical fiscal watchdog, the Financial Conduct Authority (FCA).

The bureau has repeatedly warned citizens to beryllium wary of crypto investments and sometimes archer those who put successful the abstraction to beryllium prepared to “lose each of their money.”

However, a cursory look astatine FCA warnings implicit the years would amusement that the regulator has not been protecting investors from “losing their money”; instead, the warnings look to beryllium preventing them from “making money.”

FCA Bitcoin warnings and however they affected consumers

UK’s FCA’s archetypal informing astir Bitcoin came successful December 2017 erstwhile the erstwhile caput of the bureau Andrew Bailey said, “If you privation to put successful Bitcoin, beryllium prepared to suffer each your money.”

Then, the coin was trading for astir $16,000, but the worth has since appreciated and astatine 1 clip traded for arsenic precocious arsenic $69,000 earlier dropping to its existent marketplace terms of $39,176. 

This means that contempt the intrinsic volatile quality of the coin, the FCA informing led those who heeded the telephone to suffer a imaginable 137% summation connected their investments if they had HODLed.

The bureau rehashed its informing successful October 2018, erstwhile BTC was trading astir $6,000. This meant anyone who bought it past would person earned implicit 500% returns based connected the existent price.

Another lawsuit wherever the FCA mightiness person prevented consumers from making a monolithic nett connected Bitcoin was successful March 2019 erstwhile it was trading adjacent to $4,000. 

The FCA enforcement manager Christopher Woolard stated that consumers mightiness not good recognize cryptocurrencies and added the accustomed refrain that anyone investing should beryllium prepared to suffer their money. 

Those who ignored that proposal past and bought BTC would person made adjacent to 2000% returns if they sold during the highest tally of the asset.

Bitcoin’s resilience

While FCA warnings were successful bully faith, the regulator failed to wage attraction to the almost perfect nature of the coin implicit the years. Unlike different cryptocurrencies, Bitcoin is wholly decentralized and is 1 of the astir secure blockchain networks.

This is thing that the FCA ignored successful its studies, starring to its one-sided appraisal of the plus and the half-correct predictions.

However, the regulator tin not beryllium faulted arsenic it was doing its occupation of protecting consumers arsenic investing successful the crypto abstraction remains astatine a precise precocious risk. But the paranoia that its warnings generated mightiness person caused galore to suffer retired connected important returns.