EU’s three major regulators warn of the high risk of encrypted currency investments

nThe runaway comment: European regulators, the European Securities and Markets Authority (ESMA), the European Banking Authority (EBA) and the European Insurance and Occupation Pensions Authority (EIOPA), recently issued a joint statement addressing the high investment in cryptocurrencies Risks alert residents of the European Union that the investment in cryptocurrencies is currently not protected by EU law. In fact, there is increasing discussion within the EU about this emerging area, a phenomenon that may trigger real regulatory action.n
nTranslation: Inan
The EU’s three regulators sent a warning on February 12 to EU residents considering investing in cryptocurrencies.n
A concise statement co-authored by ESMA, EBA and EIOPA indicates that the cryptocurrency market is volatile and lacks regulation and may Investors have suffered heavy losses, warning investors that “there is a high risk of buying and / or holding so-called virtual currencies.”n
The three regulators, collectively known as the European Regulators (ESAs), say they are likely to lose all their money if they choose to invest in cryptocurrencies, especially if there is a clear bubble in the current market.n
The statement wrote:n
n”Virtual currencies and exchanges that allow consumers to do such transactions are not subject to EU law, which means that consumers who buy virtual currency do not have any protection associated with regulated financial services, for example, if the virtual currency transaction Closed or the funds deposited by consumers stolen from cyber-attacks, none of the EU laws could recover its losses. “n
nThe statement made explicit reference to bitcoin, etheric, Litecoin, and Swisscoin, and further noted that other cryptocurrencies are typically sold without providing any information about their background or buying risk.n
ESAs said part of the risk of this transaction stems from the difficulty of trading cryptocurrencies as a result of delays in transactions. Users could have been able to buy a certain amount of cryptocurrencies for a certain price, but the network congestion meant they would have to buy less cryptocurrencies for a higher price.n
For residents who still want to invest in cryptocurrencies, the statement advises them to understand the characteristics of the tokens being sold and to not over-invest beyond their ability. In addition, users should take steps to ensure the security of their digital wallet.n
Recently, the EU started to discuss more about cryptocurrency market and its risks, as well as potential regulation.n
ESMA said last week that cryptocurrency will be one of the top priorities for its work in 2018, and a day later senior French and German officials called for the G20 to discuss cryptocurrency cooperation ahead of next month’s summit.n
In the meantime, Yves Mersch, an executive board member of the European Central Bank, expressed concern about the apparent “gold rush” in the cryptography market and said regulatory measures could be taken to force unregulated exchanges to report on their transactions.n

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