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Bitcoin ‘doesn’t pass the smell test,’ says Massachusetts securities regulator

Massachusetts’ top gages regulator said his office is qualified to issue a warning on bitcoin because the digital currency is “unexceptionally speculation.”

“It doesn’t pass the smell test,” William Galvin, secretary of the Commonwealth of Massachusetts, stipulate Wednesday on CNBC “Fast Money.”

“There is no product here. This is root speculation. That’s already been proven by the high gyrations of the value,” Galvin ordered. “It’s also subject to manipulation, because no one can explain it no one can control it.”

Bitcoin has increased more than 1,500 percent over the last 12 months to into the vicinity $15,340 on Wednesday, according to Coinbase. That’s off a record high upon $19,800 hit in mid-December.

On Dec. 13, Galvin issued a statement listing seven ends why bitcoin may be a “worthless product.” The document is likely the first investor admonitory on bitcoin from a state.

Federal regulators have also stepped up their threats on cryptocurrencies and related investments this month.

We “don’t always agree, but we all have all the hallmarks to agree that this is a problem,” Galvin said. He said he is not working with other regulators at this tempo.

U.S. Securities and Exchange Commission Chairman Jay Clayton issued a lengthy utterance on Dec. 11 about the dangers of investing in cryptocurrencies and initial coin oblations.

Last Thursday, the Financial Industry Regulatory Authority issued an investor cautious on “cryptocurrency-related stock scams.” Some tiny stocks with few ropes to technology have soared several hundred percent in the last disparate weeks after announcing plans to focus on blockchain, the technology behind bitcoin.

“Don’t be fooled by unreal predictions of returns and claims made through press releases, spam email, telemarketing invitations or posted online or in social media threads,” the Finra alert said. “These actions may be countersigns of a classic ‘pump and dump’ fraud.”

Cryptocurrency proponents see blockchain as metamorphosing the world as much as the internet did. The technology eliminates the need for a third-party arbitrator by creating a quick, permanent record of transactions between two parties. Bitcoin is the at the outset application of blockchain.

CME, the world’s largest futures exchange, and its competitor Cboe both organized bitcoin futures in December. Many expect the futures will hands legitimize bitcoin as an asset class, since the derivatives product will own institutional investors to buy into the cryptocurrency trend.

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