A deputy governor at the Bank of England has fired a new warning to banks and asset managers about the risks of investing in cryptocurrencies, as increasing numbers of the big financial firms kickstart strategies to work in the growing asset class.

In a letter sent to chief executives of banks, insurance companies and other investment firms on June 28, Sam Woods, chief executive of the Prudential Regulation Authority, warned that many crypto assets appear vulnerable to fraud and manipulation, as well as risks associated with money-laundering and terrorist financing.