Crypto expert’s dire warning over price prediction – ‘Be prepared to lose all your money’

Radio hosts Chris Evans and Vassos Alexander talk about crypto currency

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The Financial Conduct Authority (FCA) has recently reported that some 2.3 million adults hold cryptoassets in the UK, a rise from 1.9 million people last year. However, the regulator is warning that people’s understanding of cryptocurrency appears to have decreased, according to findings.

What did the FCA report find?

Consumer research published on June 17 by the FCA has found interest in cryptocurrency has increased in the UK over the past year.

More than half of crypto users said they have had a positive experience with cryptocurrency so far and are likely to buy more, rising from 41 percent to 53 percent.

According to the findings, more people (78 percent) had heard of cryptocurrency, a slight increase from the 73 percent recorded in last year’s findings.

Some 38 percent of users regard cryptocurrency as a gamble, which is down from 47 percent last year.

But the FCA found only one in 10 people who have heard of cryptocurrency said they are aware of consumer warnings on the FCA website.

Of these people, 43 percent said they were discouraged from buying cryptoassets.

The FCA also said most consumers recognise that cryptocurrency investments are not protected, although 12 percent of users believe otherwise.

What are the risks of investing in cryptocurrency?

Sheldon Mills, FCA’s executive director for consumers and competition, said people should be aware they can “lose all their money” when investing in cryptocurrencies.

In light of the findings, Mr Mills said: “The research highlights increased interest in cryptoassets among UK customers.

“The market has continued to grow, and some investors have benefited as prices have risen.

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“However it is important for customers to understand that, because these products are largely unregulated, if something goes wrong they are unlikely to have access to the FSCS (Financial Services Compensation Scheme) or the Financial Ombudsman Service.

“If consumers invest in these types of products, they should be prepared to lose all their money.”

Anyone considering investing in cryptocurrencies should be aware of the volatile nature of cryptocurrency markets.

There is also high risk associated with investing because cryptocurrencies are largely unregulated.

Commenting on the FCA’s findings, Anthony Morrow, co-founder of low cost online financial advice service OpenMoney, said: “It’s incredibly worrying that a growing number of people see cryptocurrency as an alternative to mainstream investments rather than an outright gamble.

“Cryptocurrencies are incredibly high risk, with massive fluctuations in value, making it very difficult for anyone to make money from them without a good deal of luck.

“If you are considering buying a cryptocurrency, make sure you are comfortable with the level of risk you are taking – remember that you could end up losing most, if not all, of your money.

“I wouldn’t recommend it as a serious investment strategy and certainly not as an alternative to mainstream investments.

“The fact that consumers who are persuaded by adverts are much more likely to regret their purchase, highlights the dangers of promoting these unregulated investments to retail investors through social media influencers, celebrities and even football clubs without explaining the risk involved.

“The regulation needs to catch up quickly to prevent more people from suffering real financial harm.”

The information in this article does not equate to financial advice. Anyone considering investing in cryptocurrency should understand the risks involved.

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