crypto traders

Most young crypto traders don’t realize it’s not regulated

According to the London-UK Financial Conduct Authority, most crypto investors under the age of 40 are unaware that it is not a regulated product.

Cryptocurrencies are not regulated in the UK. This means that if you lose money for any reason, such as a stock exchange robbery, you will not be protected by consumer protection legislation.

However, according to a study released by the FCA, most young people investing in cryptocurrencies are unaware of this, and 69% mistakenly believe it is regulated.

According to a Financial Services Watchdog study, three-quarters of young investors are “competing” with friends and family for investing in cryptocurrencies and other high-risk products such as forex and crowdfunding. I’m being driven.

Meanwhile, 68% of respondents compared investing in such assets to gambling, the FCA said. Regulators say the findings are the result of a survey of 1,000 respondents between the ages of 18 and 40 who invested in one or more high-risk investment products.

According to the FCA, more than half (58%) of respondents feel encouraged to invest after hearing about high-risk investments in news and social media.

Bitcoin is now approaching a record high after breaking over $ 60,000 last week. The world’s largest digital currencies are known to be extremely volatile, from over $ 64,000 in April to less than $ 30,000 in July. Prices have more than doubled so far this year. Despite Bitcoin’s proponents’ explanation as a long-term way to accumulate wealth, the FCA says that only 21% of people under the age of 40 in the UK make recent investments for more than a year. He said he was considering it.

“We see more people rushing for higher returns, but high returns can mean greater risk,” said Sarah, FCA’s executive director of markets.・ Pritchard states.

“We want to help consumers become more confident and safe to invest in order to understand their risks.”

Regulators say they have helped BMX Olympic gold medalist Charlotte Worthington for a campaign to warn of the dangers of investing in high-risk assets.

This was after the FCA warned earlier this year that “new, younger, more diverse consumer groups” were making higher-risk investments, citing the rise of online business applications as a possible cause. is. This year, amateur investors flocked to the stock market using platforms such as Robin Hood and Red Dit, leading to volatile trading of so-called “meme stocks” such as GameStop and AMC.

On Monday, the US Securities and Exchange Commission said Robinhood and other online brokers made investments to encourage user activity.

Earlier this year, FCA crypto investors warned that they should be prepared to lose all their money, according to a similar warning from Bank of England Governor Andrew Bailey.

Last week, BOE Vice President John Kanriff compared the growth of the crypto market with the increase in subprime mortgages that contributed to the 2008 global financial crisis.

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