Is Cryptocurrency Trading Addiction A Problem? Who Can Help?

When people speak about gambling they usually think of placing sports bets or spinning a few slot machine rounds or engaging in poker. Those are all things that are associated with the world of gambling, and most people don’t tend to look outside of those more common areas. But what about cryptocurrency trading? Despite going under the name of “trading”, it can be said that this activity is also just a form of gambling in many ways. Yet it doesn’t come with the same sort of rules as more traditional gambling options. This doesn’t mean that it isn’t as risky to engage in, though.

In some instances, the risks associated with cryptocurrency trading are a lot higher, because there is much more of a chance of losing large amounts of money in one go. It is therefore the case that being addicted to crypto trading is a possibility, too. And it has affected some people already. But who is able to provide the necessary support for these people, considering that cryptocurrency trading addiction is not highlighted in the same vein as general gambling addiction and doesn’t fall under the same regulatory remit?

Who would pay for treatment considering that any funds involved in crypto trading are not going towards funding therapy for problem traders? And is there a big problem with people who are addicted to this type of trading? Let’s find out more about this lesser-known addiction scene.

Is Trading Cryptocurrencies a Form of Gambling?

It seems pertinent to ask the question of whether or not cryptocurrency trading is really considered a form of gambling. Primarily because it doesn’t actually fall into the official bracket of what gambling is defined as in the United Kingdom. However, some sources actually maintain that it is, without a doubt, a form of gambling.

Rob Davies of The Guardian newspaper published his own thoughts on the crypto trading industry recently, and he came to the categorical conclusion that it is just another way of being able to participate in gambling activity. Within that article, he spoke of a man named Steven, who he mentioned as having “lost more bitcoin than most people will ever own”. Even though Steven had left school at 13 to become a trawlerman and then a construction worker earning £85,000-a-year, he was hooked by compulsive cryptocurrency trading. That led to alcoholism and drug use, and in the fog of these addictions, he ended up losing the addresses of his bitcoin wallets. In those wallets was an amount equal to £300,000 today.

While Steven noticed the potential of bitcoin early on and executed a talent for trading, his addiction to it means that an amount of that same value in his possession today would likely be squandered.

Steven believes that “trading is gambling”, without a doubt. Even though he taught himself how to be a good trader and set himself up a list of rules to follow, he was sucked in by trading in an all-in form, as is common with some poker players.” “I was convinced I was going to be a bitcoin millionaire”, he said.

Yet despite his addiction to crypto trading, Steven still managed to secure himself some help. In recovery at the Castle Craig residential clinic in Scotland, Steven told his story because he fears many young people will be lured in by the potential for high-risk trading, based on the premise of being able to secure untold riches through it. “A whole generation think that with a little mobile phone they can win, that they can…beat the market”.

And it isn’t so hard to believe, either. Digital currencies have swiftly gained popularity, not only in the UK, but around the world. Back in 2015 when Steven first started trading, these cryptocurrencies meant very little to most people. Today, they are being advertised as a much more democratic alternative to the centralised fiat currencies of the world.

Towards the end of 2021, the BBC reported on advertisements on the London underground for cryptocurrencies being under investigation by the Advertising Standards Authority (ASA). Those ads represented the Floku Inu cryptocurrency, named after the dog of Elon Musk. And while those ads were said to have been “legally cleared” by Floku Inu, they appeared across London seeking to entice investors by using the slogan – “Missed Doge? Get Floki”, building on the growth in popularity of Dogecoin.

Why Is Bitcoin & Crypto Trading Addictive?

Trading in Bitcoin and other cryptocurrencies has become so popular because many people have seen what sort of price fluctuations they can have. Back when Bitcoin was first launched, it was barely worth anything. Today, it has created millionaires around the world, and because the industry is still in its early days, many investors remain hopeful that trading in it can increase their own wealth status.

Yet despite massive gains by Bitcoin, Ethereum, Litecoin and others, these digital currencies remain highly volatile due to their decentralised setup. Yet it is those fluctuations in price that also make cryptocurrencies highly appealing. Because while they can take steep dives down in value, they can also make sharp inclines, and that is how people make their money off of them. Indeed, cryptocurrency investors have discussed that Fear of Missing Out (FOMO) when it comes to price rallies, and this incites a desire to constantly and frequently check price movements on them, as well as monitor news surrounding digital currencies.

Of course, unlike more traditional gambling, you don’t really have to do much with crypto trading, other than withdraw it from the market when you think it’s at the right price. Skilled traders will have taught themselves a lot about the markets and trading before engaging in it. Yet it is all too easy for someone to think of it as a simple recreational activity, buy themselves some digital currency and then start trading it with the mindset that it can swiftly make them millions of pounds. Yet in the same vein as gambling, crypto trades that experience profitable gains will undoubtedly release dopamine in a trader, giving them a “feel good” sensation. And that is what makes them continue trading and, in many cases, losing as well.

Very Few Places to Go for Help and Support

As things stand at the moment, if you get involved in cryptocurrency trading and develop an addiction to it, there are very few routes that you can take to get necessary and specialist help. One person who spoke to BBC News Scotland and wants to keep his identity a secret, is still in treatment at one of the few locations providing assistance with such. Going by the name of Jake, he said that he first bought Bitcoin in 2015, although it didn’t become such a large entity until a few years later.

“I can pinpoint the exact moment it became a problem”, said Jake. “I had been eroding the sum I put aside, but I entered a trade, and I was willing to risk that last amount I had”.

Jake went on to win back just about everything he had lost in a single crypto trade, and he described that feeling as one of “absolute euphoria”. Coupling that feeling with some difficulties in his marriage and general life would lead to Jake becoming addicted to trading. In his job, he was in charge of millions of pounds every day, and he soon took to trading money that didn’t belong to him, hoping to repeat his initial success with it.

“The first time I took it, I lost it all in about 20 minutes one night. The market moved very rapidly, and I liquidated everything. It was about 2am. I went back to bed and had to lie down next to my wife. She had no idea what I had been up to”, Jake said.

Prior to entering treatment for his addiction, he had been facing charges of embezzlement. However, he was able to pay back the £1.5 million debt he owed his employer with the help of his family.

It took cases like Jake’s for experts to launch further investigations into cryptocurrency trading and addictions associated with it. And according to those experts, this type of activity shows the same sort of behavioural addictions as problem gamblers have.

Treatment of Crypto Trading Addicts

The Castle Craig Hospital, located in West Linton near Edinburgh, exists as one of the very few establishments across the UK that will provide treatment to those addicted to cryptocurrency trading. These addictions are treated as forms of gambling addiction at the hospital, and it has described the activity as “A Modern Day Epidemic”. Doubtless, to prove the increase in people utilising cryptocurrency wallets, Castle Craig has also posted a graphics displaying the figures of wor4ldwide users between 2015 and 2018.

By quarter one of 2018, 24 million people around the world had their own crypto wallet. At the start of 2015, that figure stood at around 4.5 million people. And it was these increasing figures that led to Castle Craig recognising crypto trading addiction as a gambling problem.

Treatment at the centre exists in the form of a 12-step approach, featuring Cognitive Behavioural Therapy (CBT). Through this, patients get to understand their addiction, recognise the consequences of such, identify what they want in place of gambling, build their self-esteem, learn to control their impulses, and learn to manage their debts and finances, amongst other things.

Because this hospital, and most likely the others that treat crypto trading addiction, count it as a gambling problem, the likelihood is that the levy paid by operators to fund treatment is utilised for payment of this. This means that it wouldn’t be a huge leap to suggest that it is the gambling industry that is paying for treatment for those who are addicted to cryptocurrency trading.

Yet is this the most sustainable way of treating those people who are addicted to this form of “gambling”? After all, there is a large portion of gamblers who require treatment for general gambling problems, rather than those associated with something that isn’t even considered as such by the law.

Potential Solutions for Crypto Trading Addiction

The parallels with gambling when it comes to crypto trading are becoming even harder to turn a blind eye to, as they are becoming much more frequent these days. GamCare, which operates the UK’s National Gambling Helpline, has already stated that it generally receives around 20 calls every week relating to cryptocurrency addiction. Some of those callers spoke of trading for around 16 hours every day, suffering from huge losses along the way and struggling to cope with the guilt associated with their activity.

The first crypto addict arrived at the Castle Craig establishment in 2016, and around 100 more have entered into rehab at the hospital since then. What can be done now to try and curb the number of people suffering from crypto trading addiction? No figures exist at the moment for the number of people who are addicted to trading digital currencies, but the lead counsellor for crypto addiction at Castle Craig has already spoken of more and more people in Scotland entering the clinic for help with it.

New gambling laws are set to be introduced to the United Kingdom in due course, with the whitepaper for such expected in the spring of 2022. The government has already tried to delay the overhaul of those laws though, which campaigners condemned. Yet cryptocurrencies and trading on such are not recognised and regulated in the UK. Some trading platforms offering digital assets are regulated, but that is only because they also offer more traditional financial assets to trade on as well. The crypto assets remain unregulated, and the financial regulator of the UK, the FCA, is powerless to influence how that industry behaves.

It would therefore need to become the case that digital currencies are fully regulated. Would that also mean that they should become centralised in some way, similar to fiat currencies? That would, without a doubt, affect the volatility level of those currencies. Yet if it was written into law that this was the case, then potentially fewer people would engage in crypto trading. It is also key to note that new legislation would have to be written that surrounds cryptocurrency trading. In the same way that there will potentially be deposit and stake limitations on gamblers accessing online casinos and the like, crypto trading would likely need to be restricted in such a way to reduce the risk of addiction.