U.K. Central Bank Thinks Bitcoin Can Become Worthless, Watchdog Takes actions on Crypto Ads

An official from the U.K. Central Bank has expressed that bitcoin could be “worthless” in the coming future and individuals investing in cryptocurrency should be ready to lose everything.

The Bank of England has emphasized the possible risks of losing all gains and even the capital invested in the digital currency as a forewarning for investors in crypto. The central bank also questioned the worth of Bitcoin, which recently suffered a sell-off after news surfaced of the new Omicron variant virus whose value had skyrocketed in the previous year to $67,000 apiece.

Bank officials who examined the health of the UK’s financial system expressed their distrust about cryptocurrency being blended into the global economy, mentioning that, "a big price correction could really affect other markets and affect established financial market players". Deputy Governor of Bank of England Sir Jon Cunliffe said to the BBC, "price can vary quite considerably and could theoretically or practically drop to zero."

The central bank has warned big-time institutions attempting to embrace crypto as an asset over suspicions that it may initiate an economic breakdown. The bank’s staff noted that BTC does not satisfy multiple features demanded of a currency and it's innately volatile. Thomas Belsham works in the Bank’s stakeholder and media engagement division said "The problem is that, unlike traditional forms of money, Bitcoin isn’t used to price things other than itself.

At the same time, On Dec. 15, the Advertising Standards Authority (ASA) has decided to take action to shut down anything it considers a “misleading” crypto advert in the United Kingdom. It took down crypto-related promotions and adverts from Coinbase, Kraken, eToro, Exmo, Luno exchange, and Coinburp and also Papa John’s which is a pizza restaurant chain.

According to the watchdog, advertisements from these firms infringed its advertising rules, and hence, were unlawful. for the general public. ASA said the promotions were “irresponsibly taking advantage of consumers’ inexperience and for failing to illustrate the risk of the investment.”

One of the rulings from ASA demands to issue a just warning with the advert which isn't misleading to the consumer about the volatility and market risk. At the same time, ASA had an issue with the ‘unreasonably’ momentary disclaimer on an ad Kraken operator Payward published it said, "The risk warning only ran for one second at the beginning of a 20-second ad and we considered it presented the consumer with a large amount of information that would not be fully read or understood even if it was seen at all."

In July this year, the regulator issued a “red alert” on crypto ads and updated its capability to hunt doubted ads using artificial intelligence (AI) and scraping technology.

Regardless, the constantly growing interest in digital currency and services from investors, banks, and major payment gateway operators is an increasing concern for the banks and advertising regulators.