23 Jan UBS Chairman Warns Against Bitcoin For Main Street, Wants No Blame If Market Crashes
UBS Chairman Axel Weber advises individual clients against trading in cryptocurrency, wants to deflect blame from banks if a major crash happens in crypto.
The Chairman of UBS Bank, the world’s largest manager of wealth, Axel Weber stated on Jan. 23 that he does not advise the bank’s clients to invest in cryptocurrencies, although he makes a distinction between institutional and retail clients when discussing the subject.
Speaking to CNBC at the World Economic Forum (WEF) in Davos, Weber made the distinction between helping institutional clients enter crypto markets, as opposed to helping retail clients do the same:
“There's institutional clients and if they want to invest in (Bitcoin) — they are grown-ups, I mean they know what they are doing, they have the capability of judging this risk.”
On the other hand, according to Weber, retail (individual) clients — often referred to as “Main Street investors” – need to be “protected” from investing in the crypto market, due to their presumed ignorance of the products.
Referencing the blame put on banks for selling complex financial products to clients before the 2008 economic crash, Weber said he wants to avoid a repeat scenario and deflect blame if the crypto market sees a similar crash:
“If there is a retail client affected in the future, the question will be again who was the bank that sold them these products and then banks will be blamed again for what has happened."
In January of this year, the North American Securities Administrators Association (NASAA) and the US Securities and Exchange Commission (SEC) warned Main Street (individual) investors against investing in cryptocurrencies and Initial Coin Offerings (ICO). One of the main reasons the NASAA cited for the warning was individual investors not being sufficiently informed about the products in which they are potentially investing.