CONSOB and Bank of Italy Warn of Risks in Crypto Investments

Fazzaco learned that CONSOB and the Bank of Italy warned investors of the high risks associated with operations in crypto-assets.

According to the warning notice, in recent times, the European supervisory authorities, making reference to their warning of 2018, have reiterated the highly risky and speculative nature of crypto-assets, warning consumers to pay attention to the high risks associated with their purchase and/or possession.

For some time now, at European and international level, a growing interest on the market of crypto-assets, such as Bitcoin for example, has been registered.

Due to the absence of a reference regulatory framework, operations in crypto-assets entail various kinds of risks, including: 

• the lack of information on methods for the determination of the prices; 

• the volatility of the prices; 

• the complexity of the underlying technologies; 

• the absence of legal and contractual protections, information obligations on the part of operators and specific forms of supervision on these operators, as well as of rules to safeguard the invested capital. 

The risk of losses due to malfunctions, hacking attacks or loss of ID access to electronic wallets is also noted.

These risks now take on greater significance with reference to the spread of offers which are carried out through digital channels, facilitating the purchase of crypto-assets by a very wide range of subjects.

At the moment, therefore, the purchase of crypto-assets is not subject to the rules on the transparency of banking products and investment services and continues to lack specific forms of protection; in particular, these activities are not subject to any form of supervision or control by the supervisory Authorities.