Hong Kong regulators have warned that digital currencies may be used as a warranty for legal purposes and cash transfers may be subject to paper currency’s laws, similar to what the United States has done.
After collecting millions of funds from Bitcoin and other digital currencies, it has become probably to receive a shock this week, according to report published by Market Watch.
Where China launched a surprise campaign on " Bitcoin " caused a fall in its price, which could be considered the spark of the end of this game.
No matter how large the amount of digital money collected by speculators, it would be worthless if restrictions were put against its exchange in reality in a clear sign of its growing risks.
International warnings of their circulation
China took effective steps on last Monday to stop obtaining cash from those encrypted electronic currencies and to ban the currency support of the (ICO), which is equivalent to the currency bubble with bad reputation (IPO) in the late 1990s.
Hong Kong regulators have warned that digital currencies may be used as warranty for legal purposes and that cash transfers may be subject to paper currency’s laws, similar to what the United States has done.
The financial obsession of digital currencies depends on some exaggerated and flawed assumptions, the most important of which is the idea that governments will stand with hands off to see the boom of digital currencies.
Terrorism Financing
Digital currency can be used by everyone to buy ordinary things, but unregulated currencies can also be used by tax evaders, drug dealers, money launderers and other criminals.
After the events of 11 September, all countries around the world were interested in launching large-scale international financial campaigns for financial regulation, including intense pressure on judicial authorities, which had previously turned a blind eye to hidden financing and money-laundering.
There is no need to be exposed to another September 11 for financial regulators to be careful against the risk of encrypted digital currencies.
Officials were not interested in these currencies because of their small scale, but last week, the total market value reached 150 billion dollars, and this value is going up.
Governments are able to block digital currencies
There is no truth to the claims of digital currency supporters that their activity is outside the control of the government because of its decentralization because of its trading across different computers.
• Governments may not be able to shut down all servers, but they are able to block persons and companies that are under their jurisdiction whether for buying, selling, trading or holding these currencies, making them not transferable to any useful thing.
The US government has succeeded in blocking online poker companies a decade ago, even though they operate outside of any jurisdiction in the United States, and digital currencies are no safer.
The vagueness future of investing them
• Electronic currencies speculators have received warnings from financial regulators of the world's largest economies.
There seems to be a good coordination between them. Organizers do not block anything without prior warning, so as not to hurt simple limited experienced investors.
- Speculators received these news with a lot of confusion that resulted in large sales that caused a fall in their prices.
• Although the price of Bitcoin is far below its peak that reached about 5,000 $ last weekend, it is still high with a percent of 35% over the past month.
Digital currency obsession may continue for the time being, but the idea of long-term investment seems to be another issue, as risk increases in the coming period.
The most famous investors in "Bitcoin" around the world
The advent of encrypted e-currencies threatens the most likely transformation in modern history after the Industrial Revolution.
The digital currency relies on encryption techniques that regulate the process of introducing new units and verifying the transmission of funds and operate independently of any central bank.
Bitcoin now breaks all barriers and became very close to winning acceptance around the world with more shops and businesses starting to accept it as a way of paying.
"Insider Monkey" showed the most well-known investors in "Bitcoin", headed by Tim Draper and the Winklevoss brothers.
Tim Draper
Tim Draper is the world's most interest in "Bitcoin", a 59-year-old billionaire.
• Draper rose to fame in 2014 when he won an auction organized by the US Customs authorities to sell "Bitcoin" coins confiscated from the blocked “Silk Road” market.
• Draper bought all offered in the auction whose number is 30 thousand of "Bitcoin" and the price of one currency at that time was 645 dollars and the price today exceeds four thousand dollars.
• One estimate suggests that Draper has collected more than 16 million dollars from "Bitcoin" investment to date.
Cameron and Tyler Winklevoss
Cameron and Tyler Winklevoss became famous in 2004 when they prosecuted against Mark Zuckerberg, The Facebook founder, accusing him of stealing the social networking idea from their ConnectU site. Today, they have become the most famous investors in Bitcoin.
• In 2013, the Winklevoss brothers, they are well-known Internet entrepreneurs now, claimed to own one percent of all the "Bitcoin" in the world at the time.
Last year, Tyler Winklevoss said Bitcoin is "better than gold" and is "the largest social network ever"
• In 2015, the two established the Gemini platform, the first US stock exchange licensed for digital currency trading.
Barry Silbert
The investor Bari Silbert has been investing in encrypted digital currencies for years. In December 2014, the SecondMarket institution affiliated to Silbert won 48,000 Bitcoin in the second round of the US Customs Auction.
In this year, the price of a Bitcoin was 350 $ per one digital currency.
Charlie Shrem
Charlie Shrem is a pioneer in Bitcoin’s world and he started investing in it when he was a university student in 2011, and because of his frustration with the long process of buying and selling Bitcoin, he founded BitInstant, an easy-to-use platform that allows individuals to buy and sell Bitcoin.
• The BitInstant has received support from the investor Roger Fair of 125,000 $ and a further 1.5 million dollars from a group of investors led by the Winklevoss brothers.
Marc Andreessen
Mark Anderson is a well-known Internet entrepreneur and investor and stand behind two of Web browsers, Netscape and Mosaic.
• In 2014, Anderson said in an interview that within 20 years people will talk about Bitcoin just as we are talking about the Internet today.
• Andersen Horowitz, the 46-year-old man’s company, invested more than 227 million dollars in startups companies linked to Bitcoin until July 2015.
Michael Novogratz
The billionaire Mike Novogratz, the hedge fund manager and ex-manager of Fortress Investment Group, said in April that he was investing 10 percent of his fortune in the Bitcoin.
• The man said that Bitcoin was the "best investment" of his life and had expected in 2013 that the price of the "Bitcoin" would rise.
Chamath Palihapitiya
Chamath Palihapitiya was born in Sri Lanka, he grew up in Canada and is considered by some to be the most supporter of Bitcoin and e-currencies in general.
• In 2013, Palihapitiya, the former Facebook CEO, said that he had 5 million dollars of Bitcoin and said that he wanted to invest another 10-15 million dollars in industry.