Breaking News Bar
updated: 8/11/2014 12:03 PM

U.S. agency warns consumers about Bitcoin risks

Success - Article sent! close
Associated Press

WASHINGTON -- Federal regulators are warning consumers about the risks of using virtual currencies such as Bitcoin.

The Consumer Financial Protection Bureau says it will begin fielding complaints from people who rely on products such as Bitcoin and online exchanges for such currencies.

In issuing an advisory warning, the agency notes that the currencies are not backed by the government, have volatile exchanges rates and are targeted by hackers and scammers. And unlike bank accounts, Bitcoin-based deposits are not federally insured.

CFPB Director Richard Cordray says in a statement that "consumers are stepping into the Wild West." Still, Cordray acknowledges that virtual currencies can facilitate online transactions by making it easier to process payments.

The Securities and Exchange Commission previously issued an investor alert about virtual currencies.

Share this page
Comments ()
Guidelines: Keep it civil and on topic; no profanity, vulgarity, slurs or personal attacks. People who harass others or joke about tragedies will be blocked. If a comment violates these standards or our terms of service, click the X in the upper right corner of the comment box. To find our more, read our FAQ.