Polish Financial Supervision Authority (KNF), the body which serves as the European country’s number one financial regulator, in a new statement, has raised concerns over cryptocurrency, warning that investors may lose money due to the nature of the market.
The supervisory body has raised concerns about price volatility and the lack of consumer protection, which is prevalent around the blockchain space. The regulatory body, which is tasked with supervision of financial bodies like banking, capital markets, insurance, and pension schemes, is also concerned about the recent boom of the crypto market, which may spell doom for investors in the future.
KNF is concerned that investors are barring all risk to invest in crypto assets
The financial regulatory body believes that investors are ignoring all the red flags to commit to digital assets. The body in their analysis cited a critical case of Bitcoin, which has continued to massive fluctuate in prices amid gains and losses. It believes that Bitcoin’s gains are not as massive as the aggressive marketers of the assets make it seem to both prospective investors and society. The body thinks a lack of product knowledge by new investors and traders is also being exploited by the aggressive marketers and preachers of cryptocurrency.
In their statement, the finance gatekeepers believe that a lack of regulations in place in the crypto markets makes it difficult for the assets to be insured even when losses are made. The lack of regulated traditional financial markets also means that the assets can’t be kept safe. KNF believes that the virtual nature of the currency makes it impossible to be transacted hand-hand like fiat currencies, as crypto traders and investors will have to exchange and trade them almost all the time before using the currencies.
KNF warning fuelled by recent scam reports
The regulatory body’s new message to its citizen may have come from the recent increase in the crypto-asset scam in the central European country. The financial supervisory body’s name was involved in a crypto-asset scam that the body announced it was aware of and was already investigating. The scammer/scammers were calling prospective customers to buy and trade crypto, telling them that the KNF will be backing and insuring their investments, in any case of losses. In a move to curb the menace, the body issued a public warning to those involved and informed affected citizens to get in touch promptly.
Poland via KNF has made attempts to regulate the trading, investment, and overall affairs of cryptocurrencies. The aim behind the regulations has been to curb the menace of scams, which have been prevalent in the cryptocurrency space for a while. It is worthy to note that the country might have enacted most of the proposed regulations, but it has not negatively affected the country’s operations of cryptocurrency.