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Risk Warning - Notice to UK Users  

Estimated reading time: 2 mins

Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.

What are the key risks?

1.You could lose all the money you invest

The performance of most cryptoassets can be highly volatile, with their value dropping as quickly as it can rise. You should be prepared to lose all the money you invest in crypto assets.

The crypto asset market is largely unregulated. There is a risk of losing money or any cryptoassets you purchase due to risks such as cyber-attacks, financial crime and firm failure.

2.You should not expect to be protected if something goes wrong

The Financial Services Compensation Scheme (FSCS) doesn’t protect this type of investment because it’s not a ‘specified investment’ under the UK regulatory regime – in other words, this type of investment isn’t recognised as the sort of investment that the FSCS can protect. Learn more by using the FSCS investment protection checker here.

The Financial Ombudsman Service (FOS) will not be able to consider complaints related to this firm. Learn more about FOS protection here.

3.You may not be able to sell your investment when you want to

There is no guarantee that investments in crypto assets can be easily sold at any given time. The ability to sell a crypto asset depends on various factors, including the supply and demand in the market at that time.

Operational failings such as technology outages, cyber-attacks and comingling of funds could cause unwanted delay and you may be unable to sell your crypto assets at the time you want.

4.Cryptoasset investments can be complex

Investments in crypto assets can be complex, making it difficult to understand the risks associated with the investment.

You should do your own research before investing. If something sounds too good to be true, itprobably is.

5.Don’t put all your eggs in one basket

Putting all your money into a single type of investment is risky. Spreading your money across different investments makes you less dependent on any one to do well.

A good rule of thumb is not to invest more than 10% of your money in high-risk investments. Learn more here.

If you are interested in learning more about how to protect yourself, visit the FCA’s website here.

For further information about cryptoassets, visit the FCA’s website here.

Could crypto ever replace fiat?

The end of fiat? Exploring the potential of cryptocurrency to disrupt traditional finance and become the future of money.

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You've likely heard a Bitcoin maximalist tell you that crypto is the future and will eventually replace fiat currencies. While that's unlikely to happen overnight or any time soon, we're exploring the question looking at many factors that will contribute to this tech-forward proposition. 

While investor interest has certainly infiltrated mainstream culture, cryptocurrencies need to overcome several obstacles before they become a viable replacement. The obstacles include practical application, a willingness from merchants to embrace digital currencies, the market's volatility, and usability. Bearing that in mind, there have still been a number of shifts indicating that crypto adoption is certainly on the cards.

El Salvador Legalises Bitcoin

In June 2021, the president of the small Central American country, Nayib Bukele, announced that Bitcoin would officially be accepted as legal tender. The president also announced plans to create a Bitcoin City with the intention of becoming "the financial centre of the world.". 

Rolling out a number of services to support this concept, including a national wallet named Chivo, the endeavour cost a large amount of taxpayers' money, and not all were happy about this. 

On the other hand, Bukele was praised for being a revolutionary in the tech field, and a pioneer in the movement to shift from fiat to crypto. It's worth noting that there were mixed reactions on both sides of the crypto fence, some favouring the movement while others expressed concern over it being too premature. 

New York Mayor Accepts Salary In Crypto

In a move to make New York City the crypto capital of the world, the current mayor, Eric Adams, has stuck to his word and accepted his salary in crypto. As part of his campaign, the politician promised to accept his first three paychecks in cryptocurrency and received his first instalment in a combination of Bitcoin and Ethereum in January. 

Adams has also been vocal about his support for the NYC Coin, a digital currency that would take on similar functions as the Miami Coin released in 2021. Adams confirmed in a statement:

"New York is the centre of the world, and we want it to be the centre of cryptocurrency and other financial innovations. Being on the forefront of such innovation will help us create jobs, improve our economy, and continue to be a magnet for talent from all over the globe."

Rise In CBDCs

Venezuela is another country to adopt a pro-crypto attitude albeit born from less savoury conditions. Following a bout of hyperinflation, many turned to cryptocurrency as an alternative store of value, and as an income source as mining in the area with such low electricity prices was very lucrative. 

This eventually led to the country creating its own digital currency, the Petro, released in 2018. Cryptocurrencies released by the government in this nature are referred to as central bank digital currencies, CBDCs. 

The Bahamas and Nigeria also recently released their pilot central bank digital currencies to test the functionality and national responsiveness of the people. The "Sand Dollar" in The Bahamas is believed to be born from a combination of centralized banks being destroyed by hurricanes and accessibility to money across the various islands. 

Nigeria confirmed that the move was in line with needing a more digital approach to finances as the country has a considerably young population (in 2020, 43% of the population was aged 0 - 14 years).

A number of other countries have also announced plans to "explore" CBDcs, with China also currently rolling out a pilot program in several cities across the country. Decentralized digital currencies play an advantageous role over fiat currencies in countries affected by corruption and with largely remote areas. 

The Future Of Crypto

The future looks bright for the integration of cryptocurrencies into our traditional financial space. While it's unlikely that crypto will entirely replace fiat currencies (anytime soon or ever) it is likely that they can work alongside each other. With the rise in CBDCs around the world and the increase in mainstream crypto integration, the world has certainly taken notice of the vast benefits of using cryptocurrencies and the innovation in the space. 

Tap remains ahead of the curve with its mobile app allowing users to pay for everything using cryptocurrencies from their portfolios. Simply select which cryptocurrency you would like to use and Tap will liquidate it for the local currency of the relevant account and send the required amount of fiat funds without any hassle for you. Simple and efficient, Tap is paving the way for the future. 


This article is for general information purposes only and is not intended to constitute legal or other professional advice or a recommendation of any kind whatsoever and should not be relied upon or treated as a substitute for specific advice relevant to particular circumstances. We make no warranties, representations or undertakings about any of the content of this article (including, without limitation, as to the quality, accuracy, completeness or fitness for any particular purpose of such content), or any content of any other material referred to or accessed by hyperlinks through this article. We make no representations, warranties or guarantees, whether express or implied, that the content on our site is accurate, complete or up-to-date.


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