despite interest from more banks, UBS warns about bitcoin

Key facts:
  • For UBS bank, the regulations will make the crypto asset “bubble explode”.

  • Other banks and public bodies in Switzerland have recently adopted bitcoin.

Swiss bank UBS warned its customers about the risks that the regulations mean for cryptocurrencies, in relation to recent measures taken in several countries. This message contrasts with that of other banks in the European country that have begun to adopt bitcoin (BTC) for their services, and even with an announcement from the same bank in May 2021.

As a result of regulations being passed in different parts of the world, UBS says that digital assets could become “very risky and inconvenient for professional investors,” according to an internal statement addressed to its clients and released by the portal Decrypt.

“Regulators have shown that they can become stricter regarding cryptocurrencies. Therefore, we suggest that investors stay safe and build their portfolio based on less risky assets, ” says the statement according to the source cited. In the paper, moreover, reference is made to the “crypto markets bubble.”

This stance by UBS, a firm that also offers financial services and has a presence in more than 50 countries, is another sign of the company’s volatile relationship with cryptocurrencies. It happens that two months ago the bank admitted that it considered providing exposure to these assets to his clients, despite the fact that in February he had warned —as he did now— about his lack of credibility.

“Do cryptocurrencies become massive? Not so fast, ” says the text with which UBS criticized bitcoin in February. Source: UBS.

In addition, assessments regarding the future of cryptocurrencies differ if you consult with other entities in this field in the same country. Without going any further, Crypto news reported in June on BBVA Suiza’s decision to allow its customers to buy bitcoin directly from its app and exchange it for several legal tender currencies almost immediately.

The adoption in this European country goes even a little further: in April, the exchange-traded products (ETPs) of the cryptocurrencies Stellar XLM (XLM) and Cardano (ADA) were launched for marketing on the Six Swiss Exchange, one of the most recognized in Europe.

Similarly, even certain public bodies have decided to accept cryptocurrencies for the payment of taxes. Such is the case of the canton of Zug, which already provides the possibility of paying the tax obligations of individuals and companies with bitcoin, as reported by this medium.

The regulations that UBS talks about

Amid a climate that splits between” pro “and” anti ” cryptocurrencies in Switzerland, the UBS Bank’s warning has its foundations in certain recent events. Probably one of the most relevant is the ban on cryptocurrency mining in China, which has led to historic delays in Bitcoin network transactions and even the migration of miners to other countries.

Likewise, countries such as Spain have announced that they will increase fiscal control over crypto assets, and in the United Kingdom some operations of one of the most used exchanges, Binance, have been limited, which is already in dialogue with the authorities to adapt to the current legal framework.

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