Treat cryptocurrency investing as gambling, MPs say

MPs person urged the authorities to dainty retail concern successful cryptocurrencies specified arsenic Bitcoin arsenic a signifier of gambling.

Their worth could alteration dramatically and consumers risked losing their full investment, characteristics intimately resembling gambling, the Treasury Select Committee found.

It besides criticised abandoned plans for the Royal Mint to make a non-fungible token (NFT).

The Treasury told BBC News it did not enactment utilizing gambling regulation.

The risks posed by crypto were "typical of those that beryllium successful accepted fiscal services and it's financial-services regularisation - alternatively than gambling regularisation - that has the way grounds successful mitigating them", a Treasury authoritative told BBC News.

The committee said "unbacked" crypto assets - typically cryptocurrencies with nary fixed worth - exposed "consumers to the imaginable for important gains oregon losses, portion serving nary utile societal purpose".

"These characteristics much intimately lucifer gambling than a fiscal service," the MPs added.

Gambling helpline foundation GamCare told the BBC that, successful the past 2 years, it had heard from implicit 300 radical who said they were struggling with investing successful cryptocurrency and different forms of online fiscal markets.

Research cited by MPs recovered 40% of caller Bitcoin users were men nether 35, commonly identified arsenic the astir risk-seeking conception of the population.

Castle Craig, a rehab session specialising successful treating radical with addictions, enactment america successful interaction with a young antheral who had mislaid heavy connected crypto.

The erstwhile gambling addict told BBC News that, though helium had fixed up gambling, helium had turned to crypto.

"In my head, I conscionable thought this isn't gambling it's conscionable an concern but intelligibly it wasn't," helium said.

He said helium had mislaid astir £150,000 investing successful crypto, including wealth helium had borrowed, and that checking his telephone to spot however the marketplace had moved had go an obsession. "There was nary interruption astatine all, I was conscionable I was connected my telephone perpetually watching it and conscionable couldn't sleep," helium recalled.

He said helium supported the attack of the committee. "Crypto worldly is gambling," helium said. "You tin suffer everything you've got."

Former sports curate and gambling campaigner Conservative MP Tracey Crouch welcomed the report.

"At the moment, crypto feels similar a Wild West municipality with nary sheriff," she said.

"However, I'm sure, if decently resourced, the Gambling Commission could bring immoderate bid into this complex, risky and often confusing country that has unwittingly sucked successful consumers by selling to them via sports specified arsenic football, giving a pretence to fans and others that they are harmless and protected."

Crypto sponsorship has been wide among shot clubs, but Premier League clubs precocious agreed to extremity gambling sponsorship connected the beforehand of their shirts from the commencement of the 2026 season. This was a voluntary determination and not required by regulation.

The study gives small item connected what gambling regularisation applied to crypto mightiness mean. MP Harriett Baldwin, chairwoman of the committee, said the study recommended "that the benignant of speculative luring of radical into buying peculiar crypto currencies" was treated similar gambling.

She said the committee had heard a batch of grounds of however "football clubs are utilizing this arsenic a mode of taking wealth disconnected their loyal supporters".

In February, the authorities asked radical to remark connected proposals for the fiscal regularisation of crypto assets.

But the committee said the authorities program to modulate cryptocurrencies arsenic fiscal services would make a mendacious content they were arsenic unafraid arsenic accepted investments - a "halo effect... that leads consumers to judge that this enactment is safer than it is oregon protected erstwhile it is not".

The committee's study noted surveys suggesting astir 1 successful 10 radical successful the UK clasp crypto assets, astir investing successful cryptocurrencies specified arsenic Bitcoin and Ethereum.

The astir mentioned crushed for holding crypto assets was they were a "fun investment".

Cryptocurrencies are conscionable 1 benignant of asset. More generally, MPs said, portion they supported innovation, the imaginable benefits from crypto-asset technologies remained uncertain.

"In the meantime, the risks posed by crypto assets to consumers and the situation are existent and present."

The authorities has been excited by the imaginable of crypto. While Chancellor, Rishi Sunak announced his ambition to marque the UK a planetary hub for the technology.

The Treasury believes crypto offers opportunities, but said it was "robustly regulating the market, addressing the astir pressing risks archetypal successful a mode that promotes innovation".

Recognising the imaginable risks and rewards, the committee recommended a balanced attack but suggested authorities debar spending nationalist resources connected projects without a wide beneficial use.

"The government's caller foray into seeking (and subsequently abandoning) the accumulation of a Royal Mint non-fungible token (NFT) is simply a lawsuit successful point," the MPs wrote.

"It is not the government's relation to beforehand peculiar technological innovations for their ain sake".

NFTs are "one-of-a-kind" integer assets that tin beryllium bought and sold similar immoderate different portion of spot - they are often associated with integer images.

The committee volition analyse cardinal slope integer currencies successful abstracted report.