Mohamed Omran, chairperson of The Financial Regulatory Authority (FRA) warned investors of the risks of recent calls for dealing in cryptocurrencies, assuring that these transactions do not submit to Central Bank of Egypt (CBE) supervision.
According to a report released by the FRA, these virtual cryptocurrencies represent conning in the official monetary system, not submitting to official supervision and combatting money laundering.
“The FRA does not permit any of these currencies or even dealing in products related to them,” Omran maintained.
Moreover, he assured that calls that stimulate investors to deal in any of these currencies—on a hike in these virtual markets in order to achieve great gains—is considered to be a kind of deception that is subject to legal liability.
Recently, the cryptocurrency market witnessed a great expansion, like a bubble, as one of these currencies, namely Bitcoin, inched up 70% this month, registering a 1,700% surge in one year, to reach about $17,000 per coin, the FRA report revealed.
Despite the great turnout by investors to deal in these currencies, they are still surrounded by mystery amid supervision authorities’ subsequent warnings, Omran said.
Thus, chairperson of the FRA affirmed that the official stock markets in Egypt are restricted to the Egyptian Exchange (EGX), the Nile Exchange, and the under-development Commodity and Contracts Exchange.
In this regard, Mohamed Maher, CEO of Prime Holding for Financial Investment, assured that strong speculations on digital currencies have spread all over the world recently, as there is no means that can restrict or limit dealing in this kind of investment on the internet.
“There is a large base of investors who tend to achieve huge, rapid, temporary gains through strong speculations, a matter that can result in huge losses for the national economy,” Maher illustrated.
However, Prime’s CEO explained that speculators cannot be exposed to legal liability, while anyone set to establish a company that promotes and works in this field will submit to legal liability as it is not a codified activity, exactly like dealing in foreign exchange.
Moreover, Maher declared that any investment tool through which investors can accomplish rapid, great gains, such as Bitcoin, threatens the trading volume on the EGX.
“I think that speculators won’t respond to FRA warnings, while long-term investors who are aware of the dangers of dealing in virtual currencies will absolutely keep their investments away from this mysterious market,” he noted, adding that the FRA chairperson has to warn investors as he is a responsible official.
