My Solana is pumping’ isn’t a phrase you’d expect to hear at the school gates, but last year the playground chat was filled with crypto speculation. Parents huddled together, gossip of PTA power trips and rising house prices forgotten, for stories of big gains in crypto wild West.
And this was not at a private school in the stockbroker’s belt, but at a regular state elementary school in the Southwest, albeit in a relatively affluent area. in high school schoolsapparently it is the teenage students who are exchanging cryptocurrencies, as if they were once exchanging football cards.
After spending the early morning hours staring at larger screens to compile my morning market reports, phones were shoved at my classroom door, showing the rapid ascents of coins and tokens.
Had these crypto novices researched what they were buying? Rarely. They were funneling their cash into coins and tokens that had made the most profits, guided by expert social media superstars.
As their kids played with imaginary lightsabers, these parents displayed the full force of FOMO. The fear of missing something was strong in them. My pleas to stop, look and listen to the warnings from the Financial Conduct Authority went unheeded. My attempts to get them to consider less risky investments were largely ignored. Only one friend was paid before the accident, which, when it happened, was spectacular.
There are expectations that Bitcoin and other cryptocurrencies will rise again, like a phoenix from the ashes of this latest crash and burn. There is hope that like the dot com boom, the survivors could be the tech stars of the future.
But just like the favorite of the odds reach the moon was beaten at Ascot, they could still disappoint. It is often said that investing in cryptocurrencies is like riding a horse. But unlike horse racing, which has a history stretching back centuries, the rules of the crypto game have yet to be written.
Regulators around the world have not decided how digital currencies should be controlled and what role stablecoins and central bank digital currencies will play. Until they do, speculating in cryptocurrencies is more of a game of pin the tail on the donkey.
Regulators need to move on and try to remove the blindfold that is leaving so many crypto holders in a dark alley of despair as losses mount.
In 2021, an estimated 2.3 million Britons owned some form of cryptocurrency and a frightening 14% of holders had taken on debt to speculate.
Big-city voices have tried to take to the megaphone to warn crowds of speculators, and particular ire has been reserved for celebrity endorsements. As the head of the Financial Conduct Authority spends his time keeping up with the Kardashians, it’s clear the celebrity-cryptocurrency collision is causing concern.
(Ms. Khardashian West along with Kim Kardashian and boxer Floyd “Money” Mayweather Jr are among those sued in the US for alleged false statements promoting the EthereumMax cryptocurrency.)
Outgoing FCA Chairman Charles Randall reserved a portion of his speech for reality star Kim, saying his Instagram story connecting a cryptocurrency may have been the “financial promotion with the widest audience reach in history.” “.
There were concerns that speculation had reached such a level last year, that a crypto time bomb was ticking. Unregulated crypto assets had skyrocketed from $16 billion in 2016 to $2.3 trillion in October.
But the crash has wiped more than a trillion dollars off the value of Bitcoin and other currencies.
It also delayed government plans to make the UK an investment hub for cryptocurrencies and their innovations. Ministers have high hopes of making the UK tax system more competitive to encourage further development of the crypto asset market.
But if the highly experienced management consultants advising large companies on how to operate in this brave new world still don’t understand the rules of engagement, how are ordinary gamblers expected to protect themselves from further financial harm?
Until crypto is no longer a game of chance, investors should treat this riskier currency speculation with caution and only dabble on the margins of any portfolio, with money they are willing to lose.
But if parents want to chat about interest rates, inflation and the impact on business, mine is a cappuccino with cinnamon. But you’ll have to be quick, as those screens are calling to you.