Cryptocurrencies such as bitcoin are 鈥渟peculative investments鈥� that are very often a 鈥渟ource of fraud,鈥� 抖阴短视频鈥檚 main market regulator warned yesterday.

Mohammed Al-Kuwaiz, chairman of the Capital Market Authority (CMA), told financial professionals on the opening day of the Euromoney conference in Riyadh that investors should beware of cryptocurrencies because of worries about value and potential abuse by criminals.

鈥淲e think that cryptocurrencies are currently a solution trying to find a problem. The global financial industry does not know how to treat them. They say they are a possible replacement for conventional currencies, but we do not see that.

鈥淭hey also claim to be a store of value, but the jury is still out on that too. What they are today are just speculative investments, and we have warned investors about that. There is very little to justify them and they are often a source of fraud,鈥� he said.

Al-Kuwaiz鈥檚 strong stance on cryptocurrencies is in contrast to the official attitude earlier this year, when the CMA said it was considering what the regulatory response should be to digital currencies such as bitcoin.

The CMA chairman drew a distinction between cryptocurrencies and the blockchain technology that many of them use. 鈥淥ur belief is that blockchain can be truly transformational across many industries,鈥� he said.

He said that the Kingdom had made big strides in developing a financial infrastructure and ecosystem to attract local and foreign investors. 鈥淚n 2013, foreigners were effectively banned from the Saudi market. But just recently we moved from number 63 to the top 12 of the 鈥渆ase of doing business鈥� tables produced by the World Bank,鈥� he said.

Al-Kuwaiz said that over the past two years CMA had put in place measures to facilitate ease of raising funds, and ease of investment. It had also helped to build confidence in the Saudi financial system by allowing electronic voting by shareholders and adopting measures to protect minority shareholders.

鈥淭he result is that in recent months we have seen the biggest increase in licenses granted since the CMA was started. There has been a rapidly accelerating pace of buy-in from foreigners since the start of the year,鈥� he said.

The inclusion of 抖阴短视频 in the FTSE Russell emerging market index, and the potential inclusion in the MSCI index later this year, would further speed the development of the Saudi financial industry, he said.

鈥淲e are offering the world a product, and if you want to sell your product successfully you have to have a certificate of value, a stamp of approval to show the buyers. That is what inclusion on the emerging markets indices is, a stamp of approval from the world,鈥� he said.