- Experts say crypto trading can be addictive.
- The UK authorities are debating whether to regulate crypto as gambling.
- DL News readers are invited to share their opinions.
Psychological authorities and traders say crypto is potentially as addictive as gambling.
The claims came in a Financial Times article that could influence policy-makers in Britain as they debate how to regulate cryptocurrencies:
It is open to question, however, whether crypto should be singled out, in contrast to traditional forms of trading. As Ombudsman, I would be interested to hear what DL News readers think.
The FT article appeared on June 3, barely two weeks after the British Parliament’s Treasury Committee called for cryptocurrencies to be regulated like casinos.
It quoted Anthony Marini, chief therapist at Castle Craig, a private clinic in Scotland which calls itself the world’s first specialist crypto addiction centre. Arguing that crypto should “absolutely” be regulated like gambling, Marini said.
“People have lost families, people have lost their jobs, people have embezzled … there need to be warnings and education that this can actually kill people.”
Three of the 70 patients currently in Castle Craig recounted experiences in support of Marini’s views. Another 230 patients have been treated in the clinic since it opened its doors five years ago.
Further support came from Anna Hemmings, chief executive of GamCare, an association which offers advice and support to gambling addicts.
She told the FT that gambling typically has an impact on mental health, finance and relationships, adding: “In crypto trading what we are seeing is exactly the same.”
‘If we were to go down a route that looked at gambling regulations, then the UK could become an outlier’
There are, however, difficulties with regulating crypto like gambling, rather than bringing it under rules similar to those which govern traditional finance.
As DL News reported on June 1, a prominent British lawmaker has warned that such an approach could make the UK less competitive.
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“If we were to go down a route that looked at gambling regulations, then the UK could become somewhat of an outlier in that sense, as opposed to MiCA and some of the other approaches that are being taken across the international community,” Lisa Cameron said.
Cameron, a clinical psychologist, chairs the UK Parliament’s cross-party group on crypto.
Crypto is not, however, the only form of trading associated with the psychological impacts identified by Hemmings.
TradFi investors also appear to be at risk.
A spokesperson for Gamblers Anonymous in New York told Insider in September that the number of retail investors seeking treatment had increased by 15% over the previous year.
The reasons are unclear. Covid-19 might have been a factor because people in lock down spent long periods alone with little else to do. Big swings on the stock markets that coincided with the pandemic might also have an effect.
Pre-Covid, the development of online trading enabled individuals to buy and sell shares much more easily.
Timothy Fong, co-director of the Gambling Studies programme at the University of California Los Angeles, told Insider that there is no recognized financial trading disorder. He said he told his patients: “for insurance purposes … I’m putting this as a gambling disorder diagnosis.”
While little research has been done, a number of websites have sprung up offering advice to TradFi as well as crypto traders who suspect that they might be addicted.
It would be useful to have input from the crypto community itself.
Have you any of the signs of addiction that can be associated with crypto trading? Has your relationship with another person suffered because of their crypto trading? Share your experiences with me at robert@dlnews.com