Virtual currencies and vigilance - Anthony Curmi

Edward Mallia’s article ‘Bitcoin- what’s that?’ (January 28) prompts me to enter the fray after having read, over the past few years, so much that has been written in both the local and foreign printed media on the vagaries of Bitcoin and other cryptocurrencies.

Obviously those who have an interest in promoting such virtual currencies claim that this is the best thing to happen in the financial services; the main reason given being that we no longer need banks to make money transfers and thus avoid bank charges altogether.

However, on balance, much of what I have read was negative and highlighted the dangers of what is a purely speculative and unregulated financial instrument.

I start with the local scene.

In the last quarter of 2017 the Malta Financial Services Authority issued a stark warning advising the public to exercise caution and be vigilant when dealing with virtual currencies and to ensure that the risks involved are well understood.

It was emphasised that the value of a virtual currency can change quickly and could even drop to zero. Indeed, only a few days ago the Bitcoin value fell by as much as 30 per cent in a single day. The main exchange platforms that deal in...