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Central Bank of Ireland warns users of cryptocurrency risks

Central bank officials give warnings about cryptocurrencies

The Director-General of the Financial Conduct at the Central Bank of Ireland, Derville Rowland, said to news site Independent last May 31 that the growing popularity of cryptocurrencies like Bitcoin (BTC) is a ‘great concern’.

As one of the top officials at the Irish Financial Regulator, Rowland mentioned in the same interview that ‘crypto assets are quite a speculative, unregulated investment’ and that ‘people should be aware that they could lose the whole of that investment’.

Rowland is part of the department famous for imposing heavy fines on some of the country’s biggest financial firms. She has been appointed to this position since September 2017 and has supervised over 10,000 firms.

Additionally, cryptocurrency companies in the Republic of Ireland are required to follow the money laundering rules set by the country’s central bank last April wherein traders are no longer allowed to buy and sell their assets anonymously.

Other central bank governors around the world also raised similar concerns as Rowland and warned their constituents about the risk that comes with buying cryptocurrencies.

In a report by news site Consumer News and Business Channel (CNBC) last May 7, the Governor of the Bank of England, Andrew Bailey, said that cryptocurrencies do not have any intrinsic value.

He added that people should only purchase these digital assets if they are prepared to lose all their money. Bailey was the former chief executive of the United Kingdom’s Financial Conduct Authority (FCA) which has been sceptical about cryptocurrencies since 2017.

Moreover, in a statement to CNBC last January, the FCA warned many investors about the ‘very high risks’ of cryptocurrency.

Another similar warning was given by the Governor of the Bank of Japan (BoJ) Haruhiko Kuroda who criticized the use of Bitcoin. He said that ‘most of the trading is speculative and volatility is extremely high’ in an interview with media news site Bloomberg last May 27. Kuroda also mentioned BTC’s negative contribution to climate change as one of the reasons for his opposing stance against the top cryptocurrency.

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