Gambling in Bitcoin and digital currency? Not on Facebook. No more ICO ads.
People have been gambling with Bitcoin for nearly a decade. It’s one of the most popular means of purchasing anything and everything over the internet, anonymously. That means both legal, and illegal, merchandise and/or services.
From the beginning, investing in the decentralized cryptocurrency has been volatile. An untold number of people became exorbitantly wealthy by getting in early. But after hitting an all-time high of more than $19,000 in December 2017, talk of centralization has reversed the process.
Bitcoin has fallen dramatically since, recording a low of $7,695 today, and currently sitting around $9,450. Other digital currencies, like Ethereum, Litecoin, and Ripple, are also down 20-30%.
Investing or Gambling in Bitcoin?
Due to the monumental fluctuation and decentralized nature of digital currencies, many analysts no longer feel that cryptocurrencies are an investment, but a gamble. Last month, Bank of Canada CEO Stephen Poloz expressed similar sentiments.
In an interview with CNBC, he calls digital currencies “a true piece of genius [that] will be applied to many, many areas of the economy”. However, he also warns that “buyers should be aware it is much closer to gambling than investing”.
Numerous factors are taking the blame for the drop in Bitcoin value. Topping that list are talks of regulating the virtual coins, which would eliminate their best selling point, anonymity. The People’s Bank of China announced intentions to crack down on Bitcoin mining. South Korea wants to ban their use. All this is frightening investors into selling their coins, and the end result is a severe plummet in value.
And now Facebook comes along to drive another nail into the proverbial coffin.
Facebook Bans Cryptocurrency and ICO Ads
An ICO is an ‘initial coin offering‘, similar to an initial public offering (IPO), but in the realm of digital currency investment. When an ICO takes place, people have the chance to purchase a new digital currency the moment it becomes available. From the ground floor, so to speak.
There are several companies poised to offer ICOs in the coming months. But they won’t be advertising them on Facebook. The social media giant is instituting a ban against cryptocurrency and ICO ads.
It’s not a general dislike of the venue, but a move towards better consumer protection. The heads of Facebook fear their members will be subject to scams, and they have no desire to proliferate illegal activity and potential Ponzi schemes.
“We want people to continue to discover and learn about new products and services through Facebook ads without fear of scams or deception,” says Rob Leathern, Director of Product Management for Facebook.
“That said, there are many companies who are advertising binary options, ICOs and cryptocurrencies that are not currently operating in good faith,” he explains.
Some analysts are still boasting a positive outlook for cryptocurrencies. It’s been estimated that Bitcoin will hit $20,000, $30,000, even $50,000 before the year is out. Again, we see the volatility and potential for mass fluctuation in digital coins. But with more and more major companies and governments turning against decentralized currencies, gambling in Bitcoin could just as easily cost investors millions of dollars.