The popularity of Bitcoin exploded in recent years as top company chiefs and many economists started to see long-term value in it. But a section of traditional finance experts is still skeptical. The Bank of England governor, Andrew Bailey, recently criticized cryptocurrencies, saying they lack intrinsic value.
“They have no intrinsic value,” Bailey said at a press conference Thursday. “That doesn’t mean to say people don’t put value on them, because they can have extrinsic value. But they have no intrinsic value.”
He further went on to warn Bitcoin investors that they should be prepared to lose their money.
“I’m going to say this very bluntly again,” he said. “Buy them only if you’re prepared to lose all your money.”
Bailey has been a long-time critic of Bitcoin. And his recent comments were similar to his previous warnings in 2017, when retail demand pumped Bitcoin to $20,000, only to see a crash to prices as low as $3,200.
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His recent comments came when the crypto market is soaring, but this time with interests from institutional investors as well. Though Bitcoin and Ethereum have the trusts of expert investors, the recent rise of Dogecoin prices has rung alarm bells.
Regulators Don’t Like the Rally
Earlier, the United Kingdom’s Financial Conduct Authority, which oversights the country’s financial markets, pointed out risks with cryptocurrency investments.
“Investing in crypto assets, or investments and lending linked to them, generally involves taking very high risks with investors’ money,” the FCA stated. “If consumers invest in these types of products, they should be prepared to lose all their money.”
Recently, an American investor and billionaire, Charlie Munger, trashed Bitcoin, calling it ‘disgusting.
“I hate the Bitcoin success,” he said. “I don’t welcome a currency that’s so useful to kidnappers and extortionists and so forth, nor do I like just shuffling out of your extra billions of billions of dollars to somebody who just invented a new financial product out of thin air.”