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Hungarian National Bank rewarns against cryptocurrencies

The Hungarian National Bank (MNB) has once again issued a warning against cryptocurrencies such as bitcoin, after it received numerous complaints from users, Budapest Business Journal reported.

“So-called cryptocurrency issuers, generally advertising on the internet with intensive marketing tools and promising yields, are trying to include more uninformed users into the system,” the Hungarian central bank said in its statement.

The bank said that digital currencies or cryptocurrencies do not fall under the regulation of any central banks or any regulatory authorities. Emphasizing on the risk posed by cryptocurrencies, the MNB clarified that it does not approve, nor does it register, such currencies whether being used for the purpose of making payments or investments.

It further explained that as no guarantees are available when making payments with bitcoins or similar currencies, the system is prone to mishandling. The central said that although it is not authoritative in the case of digital currencies, it is monitoring such activities in order to inform users.

Earlier in February 2014, the MNB issued a similar warning, calling the payment method involving digital currencies "much riskier" than other electronic payment options such as credit cards. The bank warned users again last year, saying that in the event of an insolvency of a bitcoin-related company, users might not get their compensation.

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