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October 3, 2022
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UBS compares Bitcoin to Myspace and spells collapse

The financial giant UBS Wealth Management is another organization that is alerting investors to the risks associated with the cryptocurrency industry. This entity has issued guidelines that indicate that the price of any digital currency may drop to zero at any time. According to the company, investors must be prepared to lose all their money.

UBS Wealth highlights the risk of cryptocurrencies

The Swiss giant issued a warning through the portal Bloomberg. According to the company, despite the recent raids where most cryptocurrencies have risen rapidly in a relatively short period of time, investors should be prepared that they “may still lose all their money.”

UBS Global Wealth Management noted that the industry is still largely unregulated. Moreover, it is facing competition from central banks and their CBDCs.

In our opinion, there is little to stop the cryptocurrency price from going down to zero when a better-designed version is launched or when regulatory changes dampen sentiment. Netscape and MySpace are examples of web applications that enjoyed great popularity but eventually disappeared.

– wrote Michael Bollinger, investment director for global emerging markets.

The entity also questioned the fact that cryptocurrencies are actually used for payments. The company argues that most people still prefer to use fiat currencies.

The price may rise even more in the short term

While UBS admitted that the price may rise further in the short term, the report recommends that investors “limit their investment to an amount that they can actually afford to lose.”

Like most companies, UBS Wealth is skeptical about the real usefulness of virtual tokens. Other investors, however, present ambitious Bitcoin predictions, claiming that prices will continue to rise as more and more institutional investors sell gold in favor of the digital currency. This is how they want to diversify their portfolios. Scott Minerd of Guggenheim Investments said Bitcoin could be worth around $ 400,000, while strategists at JPMorgan Chase & Co. in the long term, they see an opportunity for $ 146,000.

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