As cryptocurrencies such as Bitcoin Cash become increasingly popular in parts of the Eastern Caribbean Currency Union (ECCU), the trading bloc’s central bank is warning the public to be aware of the risks associated with the system of payment.
In a statement, the Eastern Caribbean Central Bank (ECCB) said it “is aware of the recent increase in Bitcoin Cash activity in the ECCU and advises the public that the ECCB does not regulate Bitcoin Cash.”
“The public is hereby urged to be aware of the risks associated with using Bitcoin Cash or any cryptocurrency as an instrument of payment or investment.”
The bank said the Eastern Caribbean (EC) dollar, along with its digital form, DCash, are the only currencies considered legal tender in the ECCU, which is made up of Antigua and Barbuda, Dominica , Grenada, Saint Kitts and Nevis, St Lucia, Saint Vincent and the Grenadines, Anguilla and Montserrat.
The ECCB warning follows the recent collapse of Bahamas-based cryptocurrency exchange FTX Digital Markets Limited.
FTX was the third largest crypto exchange in the world before its collapse.
The Bahamian Securities Commission has since suspended FTX’s registration as an investigation into allegations of mismanagement of client funds is ongoing.
The ECCB advised members of the public “to exercise due diligence and be aware of the high level of risk of the crypto-assets present”.
“Crypto-assets are inherently volatile and speculative. As such, consumers should be aware of the risk of loss of their investment, fraud and cyberattacks, especially in jurisdictions where the industry is unregulated,” the bank noted.