Bitcoin remains front-page news around the world. Recently, investors in Hong Kong have entered the Bitcoin market along with other emerging digital currencies. Local media, however, report that many new investors may be ill-prepared for the risks associated with cryptocurrencies.
A Canadian investor living in Hong Kong dives into Bitcoin
In an interview with the South China Morning Post, a Canadian investor named Mr. Laberge said he began buying Bitcoin with $500 on November 15, when the virtual currency was trading at about $6,600. At that time he had little knowledge of cryptocurrencies. Within roughly two weeks, however, he decided to invest tens of thousands of dollars into Bitcoin.
He also shared a video detailing his experience:
https://www.youtube.com/watch?v=1ZwYP4wwLGw
Laberge described dealing with exchanges as fairly complicated. He found it difficult to contact Bitcoin trading platforms directly; unlike banks that provide a single phone number, exchanges rely on a variety of online tools and channels. Despite seeing roughly a 70% gain on his initial investment, he said he would not invest any more capital in Bitcoin for the time being.
Rapid growth creates challenges for regulators
Charles Mok, a technology sector representative on Hong Kong’s Legislative Council, said the rapid growth of cryptocurrencies presents a number of regulatory challenges. He explained that regulators are in an uncomfortable position: on one hand they want to encourage the development of an industry around Bitcoin; on the other hand, they are concerned about speculative activity that may not support sustainable, long-term growth for digital currencies. Mok warned that market dynamics could lead to a rapid collapse if left unchecked.