U.K. watchdogs are now warning consumers about following celebrities who promote the use of cryptocurrencies.
The Bitcoin logo is displayed on the side of a Bitcoin ATM on November 10, 2021 in Los Angeles, California. The price of the cryptocurrency hit a new record high today nearly breaking through $69,000 as inflation has risen to a level not seen in 30 years.
The ESAs (European Supervisory Authorities), a group of banking, market, security, and insurance regulators, claim digital assets are highly risky and speculative.
"This warning comes in the context of growing consumer activity and interest in crypto-assets and the aggressive promotion of those assets and related products to the public, including through social media," said the European financial regulators via their official press release.
UK Watchdogs Claim Crypto Not a Good Investment
According to Bloomberg's latest report, the said that the promotions featured on various social media platforms could increase the risk of misleading crypto advertisements.
Pedestrians walk past an advertisement displaying a Bitcoin cryptocurrency token on February 15, 2022 in Hong Kong, China. Cryptocurrencies are gaining popularity worldwide as investors seek to diversify into the new asset class despite wild swings in the valuations of assets like Bitcoin and Ethereum in the first weeks of the year. Buying and selling crypto is becoming common in many places.
Celebrities and other influencers promoting crypto can also worsen this situation. The ESAs, including EBA, ESMA, and EIOPA, warn people to avoid believing promotions too good to be true.
The issue of misleading cryptocurrency ads has been around ever since many people accepted the blockchain industry across the globe.
However, the United Kingdom, Spain, and Singapore already said that crypto asset promotions are only appropriate for those individuals who are wealthy enough to risk their finances.
Why Crypto is Not a Good Investment?
The European Supervisory Authorities explained why crypto assets are not good investments or means of payment for regular consumers and retail consumers.
The regulatory group claimed that if consumers use cryptocurrencies as their investments, they will likely lose their money soon.
U.K. watchdogs added that cryptocurrencies promising fast or high returns are usually false claims. If you want to see more details about the latest crypto warning of ESAs, you can visit this link.
In other news, U.S. President Joe Biden finally signed the crypto regulating executive order. Meanwhile, blockchain gaming firm Animoca recently paused its services in Russia.
For more news updates about cryptocurrencies and other related blockchain topics, always keep your tabs open here at TechTimes.
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Written by: Griffin Davis
