France's Financial Markets Authority warns investors about bitcoin

In a statement made public on November 15, the French Financial Markets Authority (AMF) announced its perspectives on investing in bitcoin and cryptocurrencies, calling for prudence to those who participate in this market and those who are considering investing in he .

The French agency published through its web portal an article in which input explains some basic concepts related to bitcoin , its operation and its uses. Later, they begin to express the position of the organism before the use of cryptocurrencies and offer some advice and warnings to people interested in entering the world of cryptocurrencies and investing in them.
The AMF catalogs the investment in bitcoin as a " risky " activity , listing a series of characteristics of the cryptocurrency and its market that it uses to support this opinion. Among them mention the fact of lacking regulatory measures , move in a digital context that can be disconcerting for those who are not familiar with it and the volatility of its price in the market .


There are several warnings that are found in this kind of practical guide for investors interested in cryptocurrencies. In terms of market volatility, its drastic upward and downward variations, as well as its complicated level of analysis, mean a high risk of losing the money invested.
Coupled with this, potential problems with network attacks or network congestion may prevent the user from selling their cryptocurrencies at the desired price, or under ideal conditions. In addition, by not having a legal framework that encloses it, there is also no guarantees offered by central banks .


As well as there are warnings, the publication also has advice on how to proceed cautiously when investing in bitcoin. One of the first to be mentioned recommends  studying the reputation of the site where the transactions will take place , such as the online exchange houses.
In France , intermediaries for bitcoin purchase and sale services require an accreditation issued by the Prudential Control and Resolution Authority ( ACPR ). Therefore, it is recommended to confirm that said intermediaries comply with this requirement.
Another of the tips emphasized by the AMF is to gain knowledge about the elementary technical and financial aspects in order to understand the context in which the investments in cryptocurrencies are developed and the risks that these entail.
The bitcoin is intended for experienced investors; a minimum of technical and financial appetite is necessary in order to understand the protocol on which it rests and its risks.
French Financial Markets Authority
It also touches the point of Contracts for Difference,  type of contract in which the difference between the purchase price and the sale price of an asset is exchanged, such as an  action , but without having to own those shares. The Financial Authority recommends above all, closely monitoring the market and being steeped in knowledge about how financial contracts work ; since by applying them based on bitcoin they can become very speculative and risky instruments.
Although the document published by the AMF mentions a number of unfavorable scenarios for cryptocurrency investors, its intention does not seem to point to a manipulation of its readers to get them away from bitcoin. On the contrary, the content of the same aims to make the public aware of the risks, certainly existent, of investing in bitcoin and other cryptocurrencies.

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