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The committee said “unbacked” crypto assets – typically cryptocurrencies with no fixed value – exposed “consumers to the potential for substantial gains or losses, while serving no useful social purpose”.
“These characteristics more closely resemble gambling than a financial service,” the MPs added.
Gambling helpline charity GamCare told the BBC that, in the past two years, it had heard from more than 300 people who said they were struggling with investing in cryptocurrency and other forms of online financial markets.
Research cited by MPs found 40% of new Bitcoin users were men under 35, commonly identified as the most risk-seeking segment of the population.
Castle Craig, a rehab clinic specialising in treating people with addictions, put us in touch with a young man who had lost heavily on crypto.
The former gambling addict told BBC News that, although he had given up gambling, he had turned to crypto.
“In my head, I just thought this isn’t gambling it’s just an investment, but clearly it wasn’t,” he said.
He said he had lost about £150,000 investing in crypto, including money he had borrowed, and that checking his phone to see how the market had moved had become an obsession. “There was no break at all, I was just I was on my phone constantly watching it and just couldn’t sleep,” he recalled.
He said he supported the approach of the committee. “Crypto stuff is gambling,” he said. “You can lose everything you’ve got.”
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