UBS Advises ‘Stay Clear’ of Cryptocurrencies — Warns ‘Regulators Will Crack Down on Crypto’
UBS Switzerland’s largest bank has advised investors to “stay clear” of cryptocurrencies and “build their portfolio around less risky assets.” “Regulators also have demonstrated that they can and will crackdown on crypto.”
UBS’ Crypto Advice and Warning
The global wealth management team at UBS warned in a note published last week that regulators worldwide, particularly the U.S. and the U.K., will impose tougher cryptocurrency regulations. Citing that “China’s latest crackdown , extending to miners, banks, e-payment networks, and social media, hurt crypto prices and operators,” the UBS analysts wrote:
“Regulators have demonstrated they can and will crack down on crypto … So we suggest investors stay clear, and build their portfolio around less risky assets.”
The bank pointed out that a number of regulators worldwide have begun tightening their oversight of the crypto market. Recently, China has been cracking down on bitcoin mining and payments. Canada’s regulator has sent notices to crypto exchanges and the regulators in Japan, the U.K., Cayman Islands, and Thailand have targeted global crypto exchange Binance.
The U.K. has imposed tight registration requirements on crypto exchanges, causing 64 firms to withdraw their applications to register.
In South Korea, most small exchanges are at risk of having to shut down operations due to strict regulatory and banking requirements.
The UBS analysts further warned:
“While we can’t rule out future price gains in cryptos, we see this as a speculative market that poses significant risks to professional investors.”
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