Axel Weber, the chairman of UBS, said they are not providing any services to customers for trading Bitcoin or other cryptocurrencies in general. Weeber also said in a conversation in Switzerland that cryptocurrencies are “often not transparent” and they can be exploited, therefore, there should be tighter legal controls over them.
According to Weber, it can be said that digital currencies are very speculative investment instruments, and also they can facilitate money laundering, terrorism and other illegal activities. He added cryptocurrencies do not currently have the features that a currency should have, they vary widely in price, and are rarely used in smooth payment transactions.
However, Weber approaches the underlying technology of cryptocurrency more moderately. According to him, blockchain technology: “everything that makes processes simpler, faster and more secure is beneficial to all of us: client, shareholder or bank.”
The criticism Weber recently put on cryptocurrencies was not the only one. In 2017, he said that Bitcoin cannot be money and explained further:
“Because money has three functions to fulfill: it has to be a means of payment – as such, Bitcoin is not universally accepted. Second, money is a measure of value. But there are no prices that are written in Bitcoin. And third, it must be suitable as a store of value. Bitcoin does not fulfill this condition either since the price of Bitcoin is not stable. A fundamental disadvantage of Bitcoin is that the number of coins dispensed is limited.”
Weber is not the only one with negative thoughts about cryptocurrencies.
In November 2017, Deutsche Bank issued a statement warning customers about their investment in Bitcoin. In January of this year Thomas Mayer, one of the former economists of Deutsche Bank, said that the cryptocurrency was a bad choice and a very risky one.
In the beginning of 2018, the North American Securities Administrators Association (NASAA) and the US Securities and Exchange Commission(SEC) notified Main Street investors in terms of investing in cryptocurrencies and ICOs. The NASAA explained its reason for the warning was because individual investors were insufficiently informed and therefore were not really able to understand the invested products.