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Massachusetts Securities Regulator: Bitcoin Fails ‘The Smell Test’

The top custodianships regulator in Massachusetts told CNBC yesterday that the bitcoin demand is “entirely speculation.”

“It doesn’t pass the smell test,” said Secretary of the Commonwealth William Galvin, whose accountabilities include overseeing the state’s securities division. He warned:

“It’s also disposed to to manipulation, because no one can explain it, no one can control it.”

Galvin’s comments are the latest from U.S. regulators that premonish investors about risks associated with cryptocurrencies, following the Gages Exchange Commission and the Financial Industry Regulatory Authority earlier this month.

Yet, it wasn’t Galvin’s in the beginning comment on the bitcoin market. Earlier this month, Galvin broadcasted a press release cautioning against “bitcoin mania,” while break he is not coordinating with other state regulators on the issue at the moment.

The come out with listed seven points for investors to consider before buying bitcoin, cataloguing checking fees on exchanges, the inability to recover stolen funds and the irrational fluctuations in price.

The federal government has also been cautioning investors on every side the cryptocurrency’s historic rise. Galvin said, “we all seem to agree that this is a unmanageable,” and also extended his concerns to issues around other activities such as prime coin offerings.

“We believe they (ICO) certainly qualify as securities,” Gavin communicated, adding “This is clearly an area with potentials for fraud. And we are terribly concerned about that.”

Massachusetts State House image via Shutterstock.

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