GamCare research has highlighted a connection between cryptocurrency investing and gambling, as people suffering from harm in either vertical experience similar difficulties.
The UK gambling charity noted that 200 calls were received by the National Gambling Helpline over the past two years from people who stated they were struggling with online financial markets, including cryptocurrencies.
Calls included “accounts of people losing over £50,000 through their trading, and young adults who spent mortgage deposits on cryptocurrency but ultimately lost large amounts of money to it”.
Raminta Diliso, Financial Harm Manager at GamCare, commented: “For many consumers, cryptocurrency purchases are a way to diversify their investment portfolio.
“However, what we have seen on the National Gambling Helpline over the past few years is that serious harm can occur if it goes too far and it’s not always the get-rich-quick opportunity some people may think it is.
“The volatility and unpredictability of these currencies can sometimes create a similar environment to gambling, where people are starting to chase the rush rather than feel they are engaging in a financial activity.”
GamCare also mentioned a recently commissioned YouGov survey of over 4,200 UK adults, which revealed that 40 per cent of crypto investors lose their investments, while 34 per cent gain money on their investments.
The survey also found that those gambling at harmful levels (PGSI 8+) were five times more likely (51 per cent) to own cryptocurrency than the rest of the general population (11 per cent).
Crypto investors who scored eight or more on the Problem Gambling Severity Index were also more likely to experience more negative impacts as a result of cryptocurrency trading, including affected ability to pay essential bills, chasing losses with further crypto investments, negative impact on mental health, affected personal relationships and feeling overwhelmed by the situation.
Harriett Baldwin MP, Chair of the Treasury Committee, added: “The Treasury Committee recently took a close look at the state of the crypto asset market. The sharp peaks and drops in the value of cryptocurrencies clearly demonstrates the risks speculating on them can pose to consumers.
“Trading of cryptocurrencies, like Bitcoin, is equivalent to gambling. By betting on these unbacked ‘tokens’, consumers should be aware that all their money could be lost.”
Earlier this week, GamCare also published guidance from its helpline on how the public can manage their gambling during the festive season.
