Consob and the Bank of Italy today issued a warning regarding investments in crypto-assets.

The regulators call the attention of the community, and in particular of small savers, to the high risks associated with activities linked to crypto-assets which can lead to a loss of the entire sums which have been invested.

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, the Italian regulators note.

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

  • lack of information on methods for the determination of the prices;
  • volatility of prices;
  • complexity of the underlying technologies;
  • 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.

The European Commission recently formulated a regulatory proposal to manage the issuance, the offer to the public, the provision of services and the fight against market abuse in relation to the different types of crypto-assets. The proposal has the purpose of defining a reliable legal framework for these instruments as well as ensuring the integrity of the market and adequate levels of protection for consumers and savers. The process for the approval of the regulatory proposal is still underway.

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, the regulator conclude.