Bitcoin is unlikely to face any new SEC rules this year, based on the watchdog’s work plan

Gary Gensler, SEC Chairman, financial regulator, alone, testifying
Gary Gensler’s SEC has increased its focus on cryptocurrencies.

  • The SEC has released its rulemaking agenda for the year – and bitcoin isn’t on there.
  • Cryptocurrencies fall into something of a regulatory grey area, SEC chief Gary Gensler has said.
  • Congress needs to take the lead in regulating bitcoin and crypto exchanges, according to Gensler.
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The US markets regulator has released its agenda for the year – and bitcoin isn’t on there.

Regulators at the Securities and Exchange Commission will be focused on short-selling, special purpose acquisition companies or SPACs, and the “gamification” of retail investing, among other topics.

But the SEC is not planning any new rules on cryptocurrencies, according to its agenda, released Friday, despite signs that it is keeping a close eye on bitcoin and other digital tokens.

SEC boss Gary Gensler has said that investors in cryptocurrencies need more protection, given that the crypto world is currently largely unregulated.

Yet he has also said that cryptocurrencies fall into something of a grey regulatory area. One issue is that the SEC makes rules for securities, but does not consider bitcoin to be one.

The SEC chairman in May pushed Congress to kick off the process of creating regulations for cryptocurrencies and crypto exchanges.

“There’s a lot of authority that the SEC currently has in the securities space, and there are a number of cryptocurrencies that fall within that jurisdiction,” Gensler told lawmakers.

“But there are some areas, particularly bitcoin-trading on large exchanges, that the public is not currently really protected.”

However, the SEC has been keeping close tabs on bitcoin and cryptocurrencies. It has warned of the dangers of investing in funds that focus on bitcoin futures, for example, and Gensler has spoken publicly about crypto assets several times.

And there are signs that lawmakers themselves are beginning to take digital currencies more seriously. Senator Elizabeth Warren last week called for a crackdown on “environmentally wasteful cryptocurrencies” like bitcoin in order to help fight the climate crisis.

Even though bitcoin doesn’t feature on the SEC’s rulemaking agenda, the markets regulator’s planned focus on “gamification” could touch upon cryptocurrencies, which retail investors trade on platforms such as Robinhood.

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Texas says state-backed banks can offer custody services for bitcoin as long as they have the proper tools to manage risk

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The Texas Department of Banking greenlighted state-chartered banks to offer custody for crypto assets in a notice on Thursday.

The notice affirms that banks may provide customers with virtual currency custody services as long as the bank has “adequate protocols in place to effectively manage the risks and comply with applicable law.”

The US’s national banking regulator made a similar announcement last year, saying that national banks and federal savings associations can provide crypto custody as an interpretation of existing law.

The Texas banking department noted that the custody services a bank chooses to offer will hinge on the bank’s expertise, risk appetite, and business model.

“For instance, the bank may choose to allow the customer to retain direct control over their own virtual currency and merely store copies of the customer’s private keys associated with that virtual currency. Alternatively, the bank may cause the customer to transfer their virtual currency directly to the control of the bank, creating new private keys that are then held by the bank on behalf of the customer,” the notice said.

The go-ahead from Texas is the latest crypto-friendly move out of the state.

Last month, members of the Texas House of Representatives passed a bill to recognize cryptocurrencies under commercial law. The bill is headed to the Texas Senate, and if passed, would be sent to Texas Governor Greg Abbott to be signed into law.

In a tweet, Abbott hinted at his support of the bill, saying he is a “crypto law proposal supporter,” and linking a Cointelegraph article referencing the bill.

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SEC tells investors to be wary of bitcoin futures due to volatility and fraud, as regulators ramp up crypto scrutiny

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Gary Gensler heads the Securities and Exchange Commission.

  • The SEC warned investors over bitcoin futures, saying the cryptocurrency is volatile and speculative.
  • It also said the market lacked regulation and had the potential for fraud and manipulation.
  • Regulators around the world are stepping up their scrutiny of the market as bitcoin booms.
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The US market regulator has warned investors about investing in funds with exposure to bitcoin futures, saying the market is volatile, unregulated and has the potential for fraud.

The Securities and Exchange Commission released a notice on Thursday urging those considering bitcoin futures funds “to weigh carefully the potential risks and benefits of the investment.” The notice was issued with the Commodity Futures Trading Commission.

“Among other things, investors should understand that bitcoin, including gaining exposure through the bitcoin futures market, is a highly speculative investment,” it said.

“As such, investors should consider the volatility of bitcoin and the bitcoin futures market, as well as the lack of regulation and potential for fraud or manipulation in the underlying bitcoin market.” Futures are contracts that allow people to speculate on the future bitcoin price.

Regulators are stepping up their focus on bitcoin and other cryptocurrencies, which boomed in the first five months of the year before falling sharply in May.

Bitcoin traded at around $37,500 on Friday, around 42% below April’s record high, giving a sense of the volatility of the asset. Heightened scrutiny from Chinese regulators is one factor in bitcoin’s recent decline.

The SEC’s warning followed the suggestion from the top global banking regulator for tough new rules for financial institutions that have exposure to bitcoin.

Rule-makers and central banks have been warning for months about the dangers of cryptocurrencies because of growing concern that investors could get burnt in the bitcoin boom.

Analysts have said that the SEC’s concerns about the dangers of bitcoin investments make it unlikely that the regulator will approve crypto exchange-traded funds any time soon.

Osprey Funds founder Greg King told CNBC on Monday he thinks a bitcoin ETF in the US could come in 2022.

King, who plans to launch a bitcoin ETF in the US, said: “Personally, I think if something happens, it’s more likely in 2022. It’s just really getting going. These things take time.”

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A key US watchdog wants officials to set up a ‘regulatory perimeter’ for cryptocurrencies

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Critics have long highlighted bitcoin’s use in crime.

  • A US banking regulator said he would like to see a “regulatory perimeter” for cryptocurrencies.
  • Michael Hsu told the Financial Times that there was growing interest in regulating crypto.
  • US and global officials have expressed concerns that retail investors could get burned by bitcoin.
  • See more stories on Insider’s business page.

The US’ Comptroller of the Currency has said he hopes officials will set up a “regulatory perimeter” for cryptocurrencies.

Michael Hsu, who oversees the country’s national banks, told the Financial Times that agencies overseeing the US financial system want to coordinate “a lot more” on the $1.5 trillion cryptocurrency market, which has boomed in 2021 but crashed sharply two weeks ago.

The comments were one of the clearest signs yet that US regulators plan to take a more active role in the cryptocurrency market.

“It really comes down to coordinating across the agencies,” Hsu said. “Just in talking to some of my peers, there is interest in coordinating a lot more of these things.”

Officials around the world worry that the crypto boom is sucking in amateur traders who could get badly burned. Bank of England governor Andrew Bailey said earlier in May that people should “buy them only if you’re prepared to lose all your money.”

In the US, there are growing signs that President Joe Biden’s administration wants to take a more hands-on approach than Donald Trump’s White House.

Biden’s Treasury Secretary Janet Yellen said in February that “the misuse of cryptocurrencies and virtual assets is a growing problem.” She highlighted their use in money laundering, terrorism and drug trafficking.

Hsu, who was appointed as Acting Comptroller by Yellen, said innovation in finance through technologies like blockchain and the rise of fintech companies reminded him of the financial crisis. He said new technologies brought great promise, but also great risk.

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Cathie Wood says central banks might add crypto to their balance sheets. Here’s the list of bitcoin-skeptic central bankers who think otherwise.

Cathie Wood
Cathie Wood is the CEO and chief investment officer of ARK Invest, which runs three of the highest-returning stock ETFs of the last three years.

Superstar investor Cathie Wood said on Thursday central banks in emerging markets could add cryptocurrencies to their balance sheets to protect against the effects of deflation as the economic boom cools.

She told CoinDesk’s Consensus event that emerging market central banks – and maybe even the eurozone – could well start holding hard assets like bitcoin “because they know their currencies are going down, and that they will be under attack as reserves go down.”

Yet central bankers have by and large been dismissive of crypto, including those in emerging economies such as India.

Hours before Wood’s comments, Japan’s central bank chief expressed doubts about bitcoin’s uses and called the asset “speculative.”

“Most of the trading is speculative and volatility is extraordinarily high,” Bank of Japan Governor Haruhiko Kuroda told Bloomberg on Thursday. “It’s barely used as a means of settlement.”

This is what other central bankers think about cryptocurrencies:

Reserve Bank of India Governor Shaktikanta Das

Das said in February he was concerned that cryptocurrencies could threaten financial stability in India.

He told CNBC TV-18 the central bank had told the government about these “major concerns.”

India’s central bank moved to ban banks from handling cryptocurrency transactions, although the Supreme Court later struck down the rule in March. Asia’s third-largest economy has considered banning cryptocurrencies altogether.

People’s Bank of China Governor Li Bo

Li said in April bitcoin is an “investment alternative,” which encouraged many in the crypto community.

“We regard bitcoin and stablecoin as crypto assets … These are investment alternatives,” he said at a panel hosted by CNBC. Yet he said they “are not currency per se” and added that he had doubts about their role in the real economy.

However, the PBoC has a history of acting tough on crypto. It renewed its crackdown on banks accepting cryptocurrencies as payments in May, triggering a plunge in bitcoin.

Central Bank of Argentina

The central bank in Argentina – which is a country prone to currency crises – warned its citizens earlier in May about the risks of cryptocurrencies, in a joint statement with the securities regulator.

It said crypto assets aren’t legal tender and “can cause significant financial losses for its holders, including the possibility of losing the totality of the resources invested.”

Bank of England Governor Andrew Bailey

Bailey had words of warning on cryptocurrencies at the BoE’s latest monetary policy meeting. “I would only emphasize what I’ve said quite a few times in recent years. I’m afraid they have no intrinsic value,” he said.

“Now that doesn’t mean to say people don’t put value on them, because they can have extrinsic value. But they have no intrinsic value.”

Bailey added: “I’m sorry, I’m going to say this very bluntly again: buy them only if you’re prepared to lose all your money.”

The Governor said later in May the rise in bitcoin was a warning sign. “You’ve probably seen all the stories about the price of bitcoin,” he said at a Bank of England event.

“That’s a warning sign. People are looking for investment opportunities. Buy it if you want, but it has no intrinsic value.”

Federal Reserve Chair Jerome Powell

Powell made a similar point to Kuroda in April, saying bitcoin and cryptocurrencies are for speculation.

“They’re really vehicles for speculation,” he told the Economic Club of New York. “They’re not really being actively used as payments.”

In March he compared cryptocurrencies to gold. “They’re highly volatile and therefore not really useful stores of value and they’re not backed by anything,” Powell said at a Bank for International Settlements event.

“It’s more a speculative asset that’s essentially a substitute for gold, rather than for the dollar.”

European Central Bank President Christine Lagarde

Lagarde said she doesn’t think bitcoin is a real currency – a view shared by most central bankers – in February, adding that central banks would not start holding cryptocurrencies.

“It’s very unlikely – I would say it’s out of the question,” Lagarde said at a virtual event hosted by The Economist.

She had been even more downbeat in January, saying bitcoin “is a highly speculative asset, which has conducted some funny business and some interesting and totally reprehensible money laundering activity.”

The ECB boss called for more regulation that “has to be applied and agreed upon… at a global level.”

ECB Vice President Luis de Guindos

Lagarde’s deputy expressed similar skepticism towards cryptocurrencies in May, saying bitcoin isn’t a real investment.

“When you have difficulties to find out what are the real fundamentals of an investment, then what you’re doing is not a real investment,” Guindos told Bloomberg TV. “This is an asset with very weak fundamentals and that is going to be subject to a lot of volatility.”

However, the ECB said in its Financial Stability Review in May bitcoin does not pose much of a risk to the financial system.

Danmarks Nationalbank Governor Lars Rohde

Rohde stuck to the central banker line on Thursday, telling Bloomberg that bitcoin is “a very speculative asset at best.”

He said: “There is no stability and no guarantee from any side about the value of cryptocurrencies.” Rohde added that he’s “tempted to ignore” cryptos.

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Ray Dalio says crypto could be a victim of its own success by inviting regulation – and his comments follow tough words from watchdogs

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Ray Dalio is one of the most successful hedge fund bosses of all time.

  • Ray Dalio said cryptocurrencies could become a victim of their own success by inviting regulation.
  • The billionaire hedge fund boss’s comments follow tough words from regulators in the UK and US.
  • Dalio has said governments could get tough on crypto if it threatens their control over money.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Billionaire hedge fund boss Ray Dalio has said the biggest risk to cryptocurrencies is their own success, which could cause governments to crack down on them to ensure they control the money supply.

Talking about cryptocurrencies, Dalio told the Wall Street Journal “Future of Everything Festival” on Tuesday: “Its own biggest risk is its success, because as a storehold of wealth no government wants to have an alternative currency.”

The comments from Dalio, the founder and co-chief investment officer of investment titan Bridgewater Associates, came soon after regulators and watchdogs in both the UK and US hinted at official skepticism of crypto assets.

Bank of England governor Andrew Bailey said last week people should only invest in crypto “if you’re prepared to lose all your money.”

And Gary Gensler, the new head of the US Securities and Exchange Commission, said in a Congressional hearing the crypto world “could benefit from greater investor protection.”

Dalio said the future of cryptocurrencies is “exciting and unknown.” He added: “Crypto as a digital clearing mechanism and so on, very exciting, very bullish. Crypto as a storehold of wealth, very interesting. Probably will be important for us.”

But he said he remained concerned that governments could get tough on crypto if they feel their monetary sovereignty is threatened, something that he has talked about in the past.

Regulators around the world are increasingly focused on cryptocurrencies after bitcoin’s meteoric rise, with Turkey banning the use of crypto assets for payments and India flirting with an outright ban.

US regulators have not so far announced any plans to tighten crypto regulations, although some analysts have said that Gensler’s stance makes the approval of a bitcoin exchange-traded fund unlikely any time soon.

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Bitcoin tumbles 9% after hitting record high above $61,000

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  • Bitcoin fell as much as 9% on Monday as investors took profits following a weekend record.
  • The cryptocurrency climbed as high as $61,742.41 on Saturday and continued to flirt with $62,000 on Sunday.
  • The consolidation came amid reports that India is considering a partial ban on cryptocurrencies.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Bitcoin fell as much as 9% on Monday after hitting a record high over the weekend as investors scrambled to take profits.

The cryptocurrency slipped to $54,733.53 at intrasession lows after surging to $61,742.41 on Saturday and continuing to flirt with the $62,000 level through Sunday.

Crypto investors are also weighing the implications of a Reuters report that India will propose a law banning cryptocurrencies that would fine anyone for trading or holding it. The coin dipped on the news before recovering some losses after Finance Minister Nirmala Sitharaman walked back the report.

“Bitcoin quickly became an overheated market, triggering many crypto whales to lock in profits,” Edward Moya, senior market analyst at Oanda, told Insider. “The anticipation of a cryptocurrency ban in India was already telegraphed, but provided added fuel to the bitcoin pullback.”

Bitcoin’s latest leg down comes after the passing of President Joe Biden’s $1.9 trillion stimulus bill helped trigger the weekend surge. The decline also dragged other cryptocurrencies lower, with ether down as much as 7%, to $1,736.57.

The coin was down 5.5%, at $56,966.42, as of 9:35 a.m. in New York.

Read more: A Norwegian billionaire who just set up a $59 million unit to invest in the bitcoin ecosystem breaks down his 3-fold strategy – and shares why he believes the digital currency is actually a solution to many of its perceived challenges

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‘Big Short’ investor Michael Burry says he doesn’t hate bitcoin but thinks its ‘long-term future is tenuous’

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  • Michael Burry sees central governments as bitcoin’s biggest adversaries.
  • The investor said in a tweet that “legally violent, heartless central governments with #lifeblood interest in monopolies on currencies” won’t allow bitcoin to remain decentralized.
  • Burry said he does not hate bitcoin, but he sees the digital asset’s “long-term future” as “tenuous.”
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Government regulation is what bitcoin bulls should fear more than anything, according to legendary investor Michael Burry.

In a Sunday tweet, the Scion Asset Management chief said while he doesn’t hate bitcoin and isn’t short the digital currency, he sees its “long-term future” as “tenuous.”

In his tweet, Burry said “legally violent, heartless centralized governments with #lifeblood interests in monopolies on currencies” won’t allow bitcoin to thrive and remain decentralized in the long-term.

Still, the Big Short investor noted “in the short-run anything is possible” for the digital currency. Bitcoin surpassed the $1 trillion market capitalization milestone last week before retracing gains on Monday. The cryptocurrency returned over 300% to investors in 2020 alone.

Burry is best known for his billion-dollar bet on a US housing market crash before the 2007-08 financial crisis which was immortalized in “The Big Short” by Michael Lewis, and a subsequent movie by the same name.

The Sunday tweet from Burry comes as he continues to sound alarms over a potential stock market collapse.

Burry claimed the “market is dancing on a knife’s edge” in a recent series of Tweets that argued rampant speculation has caused a huge bubble in the equity market.

Even worse for bitcoin investors, Burry doesn’t see gold or the digital asset as a way to prevent losses in the event of an “inflationary crisis” following a market crash. 

“In an inflationary crisis, governments will move to squash competitors in the currency arena. $BTC #gold,” the investor said.

Burry recently tweeted a string of quotes discussing Germany’s path to hyperinflation in the 1920s.

He sees America’s current trajectory as replay of the post-World War I mishaps that eventually led to a 320% monthly inflation rate in the country.

If Burry is right again, investors won’t be able to argue that they weren’t warned.

“People say I didn’t warn last time,” Burry said in a tweet. “I did, but no one listened. So I warn this time. And still, no one listens. But I will have proof I warned.”

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Almost 200 crypto firms applied to register in the UK over the last year as global interest in bitcoin boomed

Interest in bitcoin and cryptocurrencies has jumped in the UK

Almost 200 cryptocurrency companies applied to register with the UK’s financial regulator over the 12 months, as interest in bitcoin and other digital tokens rose around the world, new figures have shown.

The UK’s Financial Conduct Authority said 199 firms – from Bitcoin ATM operators to online exchanges – had applied to register with it in the year to January after the watchdog tightened its supervision of the sector.

Bitcoin has rocketed in recent days after Elon Musk’s Tesla announced it had snapped up $1.5 billion of the digital currency. More recently, Mastercard and BNY Mellon said they would start offering customers the chance to use cryptocurrencies, adding to the legitimacy of digital coins.

The bitcoin price hit a record high of above $50,000 on Tuesday, taking year-to-date gains to around 70%.

A rise in interest in cryptocurrencies from amateur and professional investors has caught the attention of regulators.

In 2020, the UK’s Treasury said crypto firms had to register with the FCA by January 2021 to ensure they comply with money-laundering regulations.

Figures seen by Insider show that the FCA received 199 applications over the year to January, with the new rules coming into force from January 10. Applications came from big financial names such as Fidelity and Revolut, as well as smaller companies based in Oxford and Glasgow.

Jonathan Rowland, chief executive of London-based bitcoin banking app Mode, told Insider the figures were simply a reflection of the “ongoing adoption of bitcoin and the growth in the audience worldwide.”

He said the UK is “very well-positioned” to take advantage of the bitcoin boom, with high demand from consumers and increasing interest from companies.

Britain’s financial regulator has granted temporary approval to 102 of the companies that applied until July, meaning they can keep serving clients. It has so far officially approved 3 separate firms: Gemini, Archax and Ziglu.

The FCA has sounded warnings about bitcoin and cryptocurrencies, reminding potential buyers to be aware of their high volatility. Bitcoin fell below $4,000 in March 2020, and tumbled from above $19,000 in 2017 to below $3,500 just over a year later.

In January, the watchdog told consumers they could “lose all their money” due to the chance that bitcoin could plunge to next to zero.

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Bitcoin ETP chief says institutional investors and ‘access products’ are key to supporting the price

Bitcoin surged in 2020 and early 2021, driving Bitcoin ETPs and other related products higher

  • Bradley Duke’s BTCetc product has soared since it launched in June 2020.
  • The bitcoin price rise has sent investors flocking towards “access products,” he says.
  • But regulators and critics are making louder warnings about “volatile” bitcoin.

It’s been a dizzying few months for Bradley Duke. The chief executive of ETC Group has seen his company’s bitcoin Exchange Traded Crypto product surge in value by around 200% in 6 months as interest in digital currencies has boomed.

Duke and ETC’s fortunes have been propelled by the huge surge in the bitcoin price. It has risen more than 280% over the last year to $32,284 on Friday morning. Bitcoin hit an all-time high of close to $42,000 earlier this month before sliding last week.

Retail investors, and even now some institutions, have rushed towards products such as the Exchange Traded Crypto (known as the BTCetc or BTCE), which tracks the price of bitcoin and is listed on the German XETRA and Swiss Six exchanges.

Duke says the fund had around $475 million in assets under management two weeks ago (although the figure will have fallen last week along with bitcoin), having only launched in June last year. And the product’s trading volumes rival those of Europe’s biggest exchange-traded funds: In the first week of the year, volumes averaged around €50.4 million ($61.2 million) a day, according to Deutsche Boerse data, and hit a record daily high of €92.6 million on January 11.

Bradley Duke is chief executive of ETC Group, which runs the Bitcoin Exchange Traded Crypto product

“It is fantastic that we did manage to catch this wave,” Duke tells Insider. “It is a wave, in the end, and there’s a lot to be said for timing.”

Read more: We spoke to Winklevoss-backed crypto platform Gemini about bitcoin and why regulation won’t kill the boom in digital currencies 

But Duke doesn’t mean the wave is necessarily about to crash. “There’s definitely been a groundswell, to continue the wave metaphor,” he says. He cites the huge COVID-19 stimulus packages unleashed by governments and central banks, and says they have sparked “concerns about inflationary forces or devaluing forces” on national currencies and helped drive up the bitcoin price.

Cryptocurrencies remain highly controversial, however, largely because of their wild volatility. If the price of bitcoin plunges as it has in the past, the value of investments in even regulated products like BTCE could fall to next to nothing. Such worries prompted the UK financial watchdog to warn this month that investors in bitcoin could “lose all their money.”

Bitcoin ETPs put a ‘regulatory wrapper’ around crypto

Duke is reluctant to give advice on the path of the bitcoin price, saying: “I don’t know what’s going to happen.”

Yet he argues that exchange-traded products like BTCE have been a major factor in making institutional investors feel more comfortable about cryptocurrencies, which has helped support prices.

BTCE lets investors gain exposure to bitcoin without having to buy the digital currency on unregulated exchanges, for a 2% fee. It tracks the price closely, is centrally cleared, and units can be redeemed for bitcoin or cash.

Overseen by German and Swiss watchdogs, BTCE puts “a regulatory wrapper around an unregulated asset class,” Duke says.

He says the company wanted to build an “access product” that “ticked a lot of the boxes for the institutional investor.” Duke says: “Definitely it started out by being mostly retail and that end of the spectrum, and then it’s definitely changed in composition to the more institutional.”

Bitcoin price has had ‘support at every level’ in recent months

Cryptocurrency supporters argue that the interest of institutional investors is a key reason the bitcoin price is unlikely to suffer a dramatic plunge, as it did in 2018 when it fell from a high of more than $19,000 to around $3,000 in just over a year.

On Wednesday, BlackRock moved to add bitcoin derivatives to two of its funds. Billionaire investors such as Paul Tudor Jones and Stanley Druckenmiller have also invested, suggesting it can be a diversifier in a portfolio at times of uncertainty akin to gold.

Read more: Goldman Sachs reveals the 8 ‘green-energy majors’ that are set to jump in value in a sector worth trillions of dollars as the renewables race heats up

Duke says institutional investors are one reason bitcoin appears to have had “support at every new price level over the last six months.” He adds: “It just feels a little bit different to how it was before. You feel like there’s a lot more people who are there, who are coming in, and who are holding and not interested in just taking short-term profits.”

Yet most institutional investors are still skeptical. A survey by Deutsche Bank last week showed investors rated bitcoin an 8.7 out of 10 on a “bubble” scale.

Gerald Moser, chief market strategist at Barclays Private Bank, said in a note that bitcoin “seems to falter when diversification is most needed, such as during sharp downturns in financial markets.” He also said bitcoin’s volatility “makes the asset almost uninvestable.”

Janet Yellen nomination
Janet Yellen, Joe Biden’s pick for Treasury secretary, suggested Bitcoin use should be “curtailed”

Some bitcoin regulators have ‘missed a trick’

Duke insists that products like his are crucial to helping cryptocurrency mature as a market. But he isn’t worried that new rules will reduce bitcoin’s appeal, in part because regulation is “a very difficult thing to do.”

He says regulators such as the UK’s Financial Conduct Authority who have clamped down on retail consumers’ access to bitcoin products “missed a trick.” (The FCA says it is protecting customers for an “extremely volatile” asset.)

Read more: Bubbly behavior is brewing in markets and Big Tech is reeling from major political events: Three investing heavyweights break down the impact

Duke argues regulators should “take a pragmatic approach and say, how best can we encourage this growth in services, but in a sensible way where we are not allowing bad actors to proliferate.”

Yet for now, regulators look set to step up scrutiny of cryptocurrencies. Treasury secretary nominee Janet Yellen last week suggested the use of bitcoin should be “curtailed” as transactions are “mainly for illicit financing.”

When it comes to investor interest in products like BTCE, the bitcoin price is all-important. The next few weeks look set to be key, with a rise past $40,000 or a tumble to $25,000 or lower both possibilities. One thing is for certain, the arguments over cryptocurrencies will continue to rage.

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