The crypto crackdown in China sent the Bitcoin price plummeting. Are major institutional investors now revising their crypto stance?
The major Swiss bank UBS Group has warned its customers about the situation on the crypto market. If the global regulatory pressure continues, investments in Bitcoin and Co. are not suitable for professional investors.
Business Insider reported yesterday, July 5th, that UBS sent its own customers a circular to inform them of the market situation. The bank referred to the regulatory events in China, which would have harmed both price developments and the crypto industry. UBS, however, warns that there are also signs that the rules are becoming more rigid in Western markets:
Regulators have shown that they can and will crack down on cryptocurrencies. Therefore, we recommend investors to stay away from cryptocurrencies and build their portfolio with less risky assets.
UBS on the zigzag course?
With such a statement, UBS seems to have started to rethink things. Finally, reports in May suggested that the bank itself was considering ways to enter the crypto market. However, the Swiss had already warned against the high volatility of Bitcoin and Co. back then.
In contrast, UBS does not generally deny the crypto market the profit potential, even in the current situation. The circular states:
While we cannot rule out future price gains in cryptos, we see this as a speculative market that carries significant risks for professional investors.