We can’t say we weren’t warned.
A new signpost was added to the crazy financial ride known as bitcoin on Friday when Coinbase, arguably the best-known bitcoin broker on the market, sent a warning message to investors: “Please invest responsibly.”
“We also wanted to remind customers of some of the risks associated with trading digital currency,” Coinbase CEO Brian Armstrong wrote in a blog post. “Digital currencies are volatile and the prices can go up and down.”
Why all the concern? Bitcoin has risen in value faster than almost any other financial instrument we’ve seen. One bitcoin was worth $1,000 in January. Yesterday, the price topped $17,000, before falling to around $15,000 today. That’s unheard of.
All investing is risky, of course, and anyone investing in the stock market should know that prices fluctuate, and things can come crashing down at any moment.
But the fact that Coinbase, a trading platform for cryptocurrencies that just hit the top of the App Store this week, felt compelled to remind people that trading is risky should be a sign that things are moving faster than even the crypto enthusiasts feel comfortable with.
The blog also reminded customers that it’s important to protect their Coinbase account with two-factor authentication, and that trading volumes are so high that there are times Coinbase might not be available due to technical reasons.
“This could result in the inability to buy or sell for periods of time,” the blog reads.
The fact that trading could be unavailable to some users is also a big deal as the price of bitcoin has been fluctuating significantly by the hour this week.
As of Friday morning, a single bitcoin had increased in value by more than $5,000 since Monday, a jump of more than 50 percent, according to Coindesk.