The Central Bank of Ireland has raised alarm bells over unbacked cryptocurrencies, cautioning investors and consumers to approach them with skepticism. In a blog post featured on the bank’s official website, Gabriel Makhlouf, the governor of Ireland’s Central Bank, drew parallels between buying cryptocurrencies and purchasing lottery tickets, noting that while a lucky few might succeed, the majority are likely to face disappointment.

Makhlouf underscored that cryptocurrencies should not be deemed investments, expressing the bank’s deep concerns regarding potential consumer harm. With the rapid growth of the crypto market, he highlighted the increasing risks faced by consumers and investors due to the absence of regulation.

The governor also criticized the aggressive promotion of cryptocurrencies and stressed the importance of transparency in advertising crypto products. He specifically called for crypto influencers to disclose any relevant financial interests they may have when endorsing such products.

Furthermore, recent developments in Ireland’s cryptocurrency landscape were mentioned. Payward Europe Solutions, an Irish affiliate of Kraken headquartered in Dublin, was granted Virtual Asset Service Provider (VASP) authorization by the Central Bank of Ireland on April 18, 2023. In addition, both Binance and Coinbase expanded their operations in Ireland in October and December of the previous year, respectively.

It was clarified that the regulation of cryptocurrencies in Ireland is evaluated on a case-by-case basis. Notably, cryptocurrencies like Bitcoin, Litecoin, and Ether are not subject to existing regulations as they are not centrally issued and do not grant rights or entitlements to holders.