The New York Times DealBook Blog reported that the Consumer Financial Protection Bureau issued its first consumer advisory on virtual currencies, including Bitcoin, and said that it would begin accepting complaints about such issues or companies.
The agency warns consumers to be aware of hackers and schemes, volatile exchange rates and a lack of government protection. “Virtual currencies may have potential benefits but consumers need to be cautious and they need to be asking the right questions,” Richard Cordray, the director of the bureau, said in a statement.
“Virtual currencies are not backed by any government or central bank, and at this point, consumers are stepping into the Wild West when they engage in the market.” In the bulletin, the agency urges virtual currency users to pay attention to potential hidden costs associated with digital money. For one, the price of Bitcoin can fluctuate wildly. In about five years, the value of Bitcoin has gone from just a few dollars to over $1,000. It is now trading around $580, according to the virtual currency website CoinDesk.