Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

Bank of France Adds to Bitcoin Warnings

12/05/2013 | 12:56pm US/Eastern

PARIS--Holders of the virtual currency bitcoin are open to financial and legal risks, the central bank of France said Thursday in a report that identified flaws in the unregulated currency.

"Even if bitcoin does not today meet the conditions to become a credible means for investment that could therefore threaten financial stability, it represents a clear financial risk for those that hold it," the Bank of France said in the report

The central bank said the us of bitcoins as an investment tool is limited because there is no underlying asset and the virtual currency is subject to high volatility. Speculators are also at risk, the bank said, as they would have no legal recourse if they are victims of theft from hackers, and could be caught out if nobody wants to buy their bitcoins.

"The system can collapse at any moment if investors want to unwind their positions but find themselves holding portfolios that have become illiquid," the report said.

The report also said the risks mean there is little-to-no reason for retailers to accept the currency, apart from as a means of self-promotion.

The report coincides with a statement from the People's Bank of China, which said it doesn't consider bitcoin to be a real currency and financial institutions should not provide bitcoin-related business services.

Beyond the risks to investors, retailers and speculators, France's central bank, like China's, also flags the dangers of bitcoin as an anonymous currency that can be used for illegal activities, including money laundering and terrorism.

Write to William Horobin at william.horobin@wsj.com

React to this article
Latest news
Date Title
04:09p DELPHI AUTOMOTIVE : Other Events (form 8-K)
04:09p HOSPIRA : Other Events (form 8-K)
04:09p MESABI : Other Events (form 8-K)
04:09p DARLING INGREDIENTS : Change in Directors or Principal Officers (form 8-K)
04:09p DEPARTMENT OF FINANCE OF CANADA : Releases Annual Tax Expenditures and Evaluations Report
04:08p MAVENIR SYSTEMS : Change in Directors or Principal Officers (form 8-K)
04:08p ZILLOW : Regulation FD Disclosure (form 8-K)
04:08p BRIXMOR PROPERTY : Change in Directors or Principal Officers (form 8-K)
04:08p AMTRUST FINANCIAL SERVICES : Change in Directors or Principal Officers (form 8-K)
04:08p MEDLEY MANAGEMENT : Capital Corporation : Announces Stockholders' Meeting Results
Latest news
Advertisement
Hot News 
TCPI : is Evaluating Claims Filed on February 26th, 2015
ALPHATEC : posts 4Q loss
RIVER AND MERCANTILE : Concern For Pensions Ahead Of General Election
GIGA TRONICS : Entry into a Material Definitive Agreement, Unregistered Sale of Equity Securities, Financial Statements and Exhibits (form 8-K)
OPTOS : Shares Surge Higher On Recommended Takeover Bid From Nikon
Most Read News
03:35p Oil up sharply, posts first monthly gain since June
07:53a BP : Oil & Gas UK Appoints Deirdre Michie From Shell As New Chief Executive
02/26DJCOUNTRY GARDEN : Issues $900 Million, Five-Year Bonds at 7.5%
02/26DJSOUTHWESTERN ENERGY : to Cut Investment Spending
02/26 DEUTSCHE TELEKOM : sees dividend growth in line with free cash flow
Most recommended articles
02/20DJMarkets Hang on Greek Impasse
04:07p FED OFFICIALS AGNOSTIC ON JUNE VS SEPT RATE HIKE : Fischer
04:05p EU Commission urges France to cut deficit at quicker pace
04:05pDJFISCHER : Fed Closer to Rate Rises, But Exact Timing Remains Unclear -- Update
04:03p Test for reform zeal of India's Modi in make-or-break budget
Dynamic quotes  
ON
| OFF