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If you are techno-skeptical, virtual currencies like Bitcoin may be a good reason for that.
Homero Josh Garza, who founded two cryptocurrency startups, has been ordered to pay nearly $10 million for wire fraud. His companies have been hit with a judgment of more than $10 million.
The fines barely dent the $172 billion market, but it's a shot across the bow to everyone dealing in digital currencies. And big banks like JP Morgan are saying, "we told you so."
The Securities and Exchange Commission sued Garza in 2015, alleging his companies sold more than 10,000 "investment contracts representing shares in the profits they claimed would be generated from using their purported computing power to 'mine' for virtual currency."
It wasn't true. Garza admitted in a plea deal that his businesses were an illegal pyramid scheme. He also told Ars Technica that he made more than $1 million in the first month, and soon made between $60 and $80 million a year.
At the same time, the SEC filed charges against a New York businessman for allegedly selling unregistered securities through digital coins. The initial coin offerings (ICO's) were purportedly backed by real estate and diamonds.
"Investors should be wary of companies touting ICOs as a way to generate outsized returns," said Andrew M. Calamari, director of the SEC's New York office.
"Bitcoin Is a Fraud"
At a conference last month, JP Morgan boss Jamie Dimon said digital currencies aren't going to work. It's "currency out of thin air," he said.
"If you were in Venezuela or Ecuador or North Korea or a bunch of parts like that, or if you were a drug dealer, a murderer, stuff like that, you are better off doing it in bitcoin than US dollars," he said. "So there may be a market for that, but it would be a limited market."
The Guardian, reporting on Dimon's speech, said Bitcoin's value fell 6 percent the next day. On the other hand, Bitcoin has quadrupled since December to about $4,000.
Meanwhile, many businesses in the United States -- including law firms -- accept virtual currencies in lieu of cash.