Saudi Arabia's finance ministry warns of cryptocurrency fraud

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Saudi Arabia's finance ministry warns of cryptocurrency fraud

Saudi Arabia's ministry of finance has warned that fraudsters from Singapore are attempting to con crypt-investors into investing in a "virtual currency" they claim will fund government projects.

The ministry said that the Singapore-based company is pushing "CryptoRiyal" and "SmartRiyal" cryptocurrencies, linked to the Saudi riyal currency.

In a statement issued this morning the ministry cautioned, "Any use of the KSA name, national currency or national emblem by any entity for virtual or digital currencies marketing will be subject to legal action by the competent authorities in the kingdom."

Cryptocurrencies are a risky investment... The sector is not yet fully regulated and a lot of projects use fake names and identities, such as countries’ names or flags, to manipulate investors."

Dr Assad Rizq, an expert on cyrptocurrencies, told Arab News, "A lot of tricks can be played. Some of these companies are not regulated, they have no assets, and even their prospectus is sometimes copied from other projects.

"They hype and pump their project so the price goes up. Inexpert investors, afraid of missing out, jump in, which spikes the price even higher, then the owners sell and make tons of money."

Dr Rizq explained: "Cryptocurrencies are a risky investment for two reasons. First, the sector is not yet fully regulated and a lot of projects use fake names and identities, such as countries' names or flags, to manipulate investors.

"Second, you have to do your homework, learn about the technology. And if you still want to invest, consider your country's rules and regulations."


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Christopher Copper-Ind

Christopher Copper-Ind is editor-in-chief of International Investment. Before this, he was editorial director of The Business Year, from 2014 to 2017.

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