Bitcoin and other cryptocurrencies can see their value drop to almost zero at any time, warns Vitalik Buterin, co-creator of the Ethereum network. He recalls that they are all very recent and very volatile, advising not to commit more money than we can afford to lose by investing in cryptocurrencies.
The explosion of the bubble and the fall in the value of cryptocurrencies have been predicted for several months by many financiers and economists. This time, it is the co-creator of the Ethereum network that warns investors against too much confidence in bitcoin, ether, ripple or other altcoins. Vitalik Buterin, a 24-year-old Russian, worries about the popularity of cryptocurrencies.
"Reminder: cryptocurrencies are still new and hyper-volatile assets, and could drop to almost zero at any time," he says on Twitter. "Do not put more money than you can afford to lose. If you try to find a way to put your savings, the traditional means remain a less risky bet, "he advises. For more information on investing in Bitcoin, we invite you to consult our dedicated file.
Bitcoin and Ethereum represent financial risks
A statement that may surprise since he helped found the world's most powerful cryptocurrency network after Bitcoin, Ethereum. But it is mostly common sense and prevention because some have risked big to interfere in the market. Nearly 20 percent of people with Bitcoin are in debt, according to a CoinDesk study.
Moreover, the banking institutions are starting to feel concerned too and have everything to lose if their clients come out ruined of a bad investment. In the United States and the United Kingdom, banks have begun to ban the purchase of cryptocurrencies via credit cards. The concern has increased since January 2018 after the tumble prices of all cryptocurrencies.
Their volatility coupled with their success has also provoked the interest of governments. Emmanuel Macron has shown his support for their regulation and will make a joint proposal with Angela Merkel in this direction at the next G20 summit. He believes that cryptocurrencies are threats to financial stability, and wants to involve the IMF.
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