The head of the Central Bank of Ireland, Gabriel Makhlouf, has advocated for a ban on cryptocurrency-related advertising.
Cryptocurrency ads associated with ‘ponzi schemes’
Makhlouf believes that investing in cryptocurrencies that are not backed by any traditional assets is gambling and claims that advertisements that promote cryptocurrency projects often expose investors to high-risk investments and even outright scams.
He is concerned that many young adults are targeted by these advertisements and have invested in cryptocurrencies.
In a statement, the head of the Irish Central Bank expressed his belief that unbacked cryptocurrencies are similar to Ponzi schemes.
He explained that individuals are often compelled to invest their money in these types of cryptocurrencies without any backing, making this investment a form of gambling. He also stated that most of the prominent cryptocurrencies available fall into this category.
Makhlouf also emphasized the targeting of young individuals in crypto advertising and the potential negative impact on this impressionable group. He urged for measures to be taken to prevent these advertisements from reaching this specific demographic.
Regulatory action within the crypto market is rising
The Central Bank of Ireland has spoken out against cryptocurrencies before. Back in March 2022, the Central Bank of Ireland issued a warning regarding the dangers of investing in digital currencies like bitcoin.
Derville Rowland, a leading official at the bank, stated that these assets are speculative and unregulated and that individuals should be aware that they could potentially lose their entire investment when dealing with these unregulated assets.
The recent statement from the Central Bank of Ireland’s head is yet another call for increased regulatory oversight in the cryptocurrency industry and market following the FTX catastrophe.
Following the demise of the popular exchange, multiple lawmakers across the world have taken notice to the importance of additional oversight as multiple entities move to enact laws and guidelines for the cryptocurrency industry.
To protect consumers and mitigate the potential consequences of a cryptocurrency market crash, the European Union (E.U.) Parliament’s Economic and Monetary Affairs Committee has recently implemented strict regulations for banks holding digital assets.