AUB warns against dealing in crypto-assets – ‘Cryptocurrencies lack security’

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KUWAIT CITY, Nov 28: As part of its support for the second edition of the financial and banking awareness campaign “Let’s Be Aware”, Ahli United Bank (AUB) warns against dealing in crypto-assets, including Bitcoin, Ethereum, Dogecoin, etc., especially that these currencies are untraceable and are not real, which make them pose a danger to their traders because they are not subject to regulation or supervision by any authority.

Thus, these cryptocurrencies lack security and do not receive the government support provided to official currencies issued by majorities of central banks. These crypto-assets pose a threat to the global financial system, particularly that dealing in them may be carried out through illegal / bogus wallets or organizations, which could lead and direct individuals’ funds beyond the guarantees of official trading guideline. Moreover, these crypto-assets can be used in money laundering, terrorist financing and other related criminal activities that cannot be traced as they are done under fictitious names over the internet.

In this context, Ahli united bank ( AUB) , underlined in a press release that AUB draws attention to the importance of customers’ awareness of the risks of investing in high-risk products promoted via the internet, such as these crypto-assets, which are dominated by instability and high fl uctuation in their prices due to global unsupervised speculations. AUB added that real currency is issued by a lawful state as currency and as a symbol of sovereignty, and the state strives to protect it and employ policies that guarantee relative stability of the exchange rate against major world currencies.

A currency is considered and accepted as a store of value and legal tender, and serves as a reliable medium for exchange, which is not available for crypto-assets. AUB warned that the rapid developments witnessed by Fintech worldwide, with their pros which include the simple and resilient completion of commercial exchanges, conducting financial transactions, making remittances and buying online. They also have some cons, including multiple means of communication and their conversion into a primary channel for marketing, which may make them a window for promoting high-risk investments.

Jaragh said that issuing and marketing this cryptocurrencies by unknown entities poses a great risk to the assets and funds of investors and speculators and exposes them to heavy losses, given that these cryptocurrencies are not subject to any kind of supervision that guarantees the regulation of issuances and preserves the rights of investors, unlike real currencies that central banks or other monetary authorities supervise, evaluate and regulate their issuance.

It should be noted that “Diraya” campaign aims to inform customers about the role of banks as a financial intermediary, the importance of saving and investment, and how to benefit from the products provided by banks, and to educate customers about their rights related to personal financings, including consumer or housing loans, and the mechanism for filing complaints regarding banking services, in addition to various bank cards. The most important steps to be taken to avoid exposure to fraud and raise awareness of the risks of socalled “loan payment”, high-risk investments and other important topics. The campaign also includes various topics such as borrowing process, bankcards and awareness of the rights of customers with special needs. It also deals with advice related to cybersecurity and the protection of bank accounts, in order to clarify the mechanisms for filing a complaint and protecting customer rights, while defining the function of the banking sector and its role in stimulating and developing the economy so that all segments of society would be familiar with banking and financial transactions.

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