The top brass at one of the UK’s leading financial regulators has given a stark warning to those investing in Bitcoin. Andrew Bailey of the Financial Conduct Authority said that people who had bought Bitcoin better be prepared to “lose all their money”. Presumably, he meant just the portion that they’d invested in cryptocurrency, however.
For Bailey, without central banking, or government backing, there was nothing at all to suggest that Bitcoin was a secure investment. He likened the level of risk posed to proponents of digital currency to gambling. He told a BBC reporter on their Newsnight program:
It’s not a currency, it’s actually not regulated in its Bitcoin form.
He commented on the volatility of the market in terms of pricing, citing the last year’s gains as reason for caution. He even suggested that there was no evidence to determine what informs the current price of Bitcoin.
Continuing, he highlighted that the supply of Bitcoin is fixed, but for a supposed financial expert, failed to acknowledge that huge increases in demand versus a fixed supply can result in a price going in one direction, and one direction only – up. His summary of Bitcoin’s finite number was simply, “odd”.
Spoken like someone who is absolutely clueless about the Bitcoin and the wider cryptocurrency space, he neglected to acknowledge either of the main driving forces behind the current price of digital assets like BTC, ETH, and LTC. Firstly, there was no recognition that they represent a growing resistance to a toxic banking system that has kept people in servitude to non-elected actors for all of the current century, and most of last. Secondly, he failed to acknowledge the less noble reason behind the surge in price, that is the “get rich quick” folk.
Bailey is just the latest of a long line of critics of decentralised digital currency. We’re sure that there were people who were opposed to every other game-changing technology that has ever been created. The motor car was faced opposition from people who thought there’d be bedlam in the streets and that people wouldn’t be able to drive across town without mowing down at least three children on the way.
Meanwhile, perhaps the most democratising innovation mankind has ever known, the internet, also met fierce resistance. I mean, who would want to use it apart from drug traffickers and child pornographers? The notion of ordering a pizza, or buying your Christmas shopping online was one that early naysayers couldn’t compute, just as the blockchain-based, digital democracy we’re rapidly moving towards is today.