Cryptocurrencies should be regarded as high-risk investments, Dubai financial regulator says

Bitcoin is a digital currency that enables individuals to transfer value to each other and pay for goods and services, bypassing banks and the mainstream financial system. (Reuters)
Updated 14 September 2017
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Cryptocurrencies should be regarded as high-risk investments, Dubai financial regulator says

DUBAI: Dubai’s financial regulator on Wednesday cautioned potential investors the risks associated with online products involving cryptocurrencies, which it described as “high-risk investments.”
“The DFSA would like to make it clear that it does not currently regulate these types of product offerings or license firms in the Dubai International Financial Center, DIFC, to undertake such activities,” the Dubai Financial Services Authority said in a statement.
“Before engaging with any persons promoting such offerings in the DIFC, or making any financial contribution toward such offerings, the DFSA urges potential investors to exercise caution and undertake due diligence to understand the risks involved.”
The regulator said that these products usually involve the issuance of some form of virtual coin, token or other symbol of virtual currency in return for payment of a subscription price, and are offered to the public through fundraising events referred to as ‘Initial Coin Offering,’ ‘Initial Token Offering’ or ‘Token Sale’.
“The DFSA wishes to highlight that these types of product offerings, and the systems and technology that support them, are complex. They have their own unique risks, which may not be easy to identify or understand,” DFSA said.
“Such risks may increase where offerings are made on a cross-border basis. These offerings should be regarded as high-risk investments.”
Earlier this week Jamie Dimon, the chief executive of JPMorgan Chase & Co, described bitcoin as a ‘fraud’ and was ‘worse than tulips bulbs,’ referring to a famous market bubble from the 1600s.
“The currency isn’t going to work. You can’t have a business where people can invent a currency out of thin air and think that people who are buying it are really smart,” Dimon said at a banking investor conference in New York.


Oil prices fall on expected output rise after OPEC deal

Updated 25 June 2018
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Oil prices fall on expected output rise after OPEC deal

SINGAPORE: Brent crude oil prices fell over 1.5 percent on Monday as traders factored in an expected output increase that was agreed at the headquarters of the Organization of the Petroleum Exporting Countries (OPEC) in Vienna on Friday.
Brent crude futures, the international benchmark for oil prices, were at $74.21 per barrel at 0343 GMT, down 1.8 percent from their last close.
US West Texas Intermediate (WTI) crude futures were at $68.40 a barrel, down 0.3 percent, supported more than Brent by a slight drop in US drilling activity.
Prices initially jumped after the deal was announced late last week as it was not seen boosting supply by as much as some had expected.
OPEC and non-OPEC partners including Russia have since 2017 cut output by 1.8 million barrels per day (bpd) to tighten the market and prop up prices.
Largely because of unplanned disruptions in places like Venezuela and Angola, the group’s output has been below the targeted cuts, which it now says will be reversed by supply rises especially from OPEC leader Saudi Arabia. Although analysts warn there is little space capacity for large-scale output increases.
“Several ministers suggested that (rises) would correspond to a 0.7 million bpd increase in production,” said US bank Goldman Sachs following the announcement of the agreement, although it added that were risks “that Iran production may be even lower than we assume” and that its output could fall further due to looming US sanctions.
Still, Britain’s Barclays bank said OPEC’s and Russia’s commitments would take “the market from a -0.2 million bpd deficit in H2 2018 to a 0.2 million bpd surplus.”
Energy consultancy Wood Mackenzie said the agreement “represents a compromise between responding to consumer pressure and the need for oil-producing countries to maintain oil prices and prevent harming their economies.”
In the United States, US energy companies last week cut one oil rig, the first reduction in 12 weeks, taking the total rig count to 862, Baker Hughes said on Friday.
That put the rig count on track for its smallest monthly gain since declining by two rigs in March with just three rigs added so far in June, although the overall level remains just one rig short of the March 2015 high from the previous week.