NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

Wednesday, March 12, 2014

Two financial regulatory bodies have issued new Bitcoin-related warnings and sanctions this week.

The first came from FINRA, the financial industry’s self-regulatory organization. It published aninvestor’s note on Tuesday saying that “selling and using bitcoins carry numerous risks.” The second warning came Monday from a Texas state financial regulator. That document is an emergency cease-and-desist order against Balanced Energy, an energy firm taking investment in bitcoins.

FINRA’s warning declared:

Digital currency such as Bitcoin is not legal tender. No law requires companies or individuals to accept bitcoins as a form of payment. Instead, Bitcoin use is limited to businesses and individuals that are willing to accept bitcoins. If no one accepts bitcoins, bitcoins will become worthless.