Banks have been forced to take a hard stance against the growing trend, which poses a very real threat to traditional economic systems as more and more people elect to buy goods and services with decentralised currency.

Launched in 2008 as an alternative to mainstream banking services, Bitcoin has generated an unprecedented demand in alternative currency, encouraging the growth of countless new blockchain-based coins in a market now worth trillions.

However, the natural hysteria encapsulating the global cryptocurrency market has traditional economists hesitant to declare the revolutionary tech a failsafe investment.

Coins such as Dogecoin – which is now the fourth most popular cryptocurrency with a market cap of over $US84 billion – have risen in value on the back of internet memes.

Tech billionaire Elon Musk also holds tangible power in manipulating markets from his Twitter account, as seen earlier this year when Bitcoin surged after Tesla announced it had invested $US1.5 billion in the currency and would be accepting it as payment.

But for investors deep in the world of cryptocurrency, the phenomenon is more than a get-rich-quick scheme.

Pro-crypto advocates have long been attracted to the privacy blockchain transactions provide, as opposed to a traditional bank where every cent of your spending is on record for an institution to view at will.

According to Mr Bailey, the volatility is cause for serious concern for anybody with real money invested in cryptocurrency.

“They have no intrinsic value. That doesn’t mean to say people don’t put value on them, because they can have extrinsic value. But they have no intrinsic value,” he said, according to a report from CNBC.

“I’m going to say this very bluntly again ... buy them only if you’re prepared to lose all your money.”

Bitcoin experienced an astronomical boom in late 2017, bursting to around $A25,000 per coin and attracting thousands of new investors before plummeting to under $A3000 a year later.

However, those who resisted the urge to cash out as markets crumbled have been rewarded for their faith, with the value bouncing back to $A74,000 in May 2021.

Mr Bailey’s warning to crypto investors came after a similar statement from the UK’s Financial Conduct Authority,

“Investing in cryptoassets, or investments and lending linked to them, generally involves taking very high risks with investors’ money,” the watchdog said in January.

“If consumers invest in these types of product, they should be prepared to lose all their money.”

To some, the unpredictability of cryptocurrency is half of the appeal. Something as simple as a photo posted to Twitter by Mr Musk can shift markets by absurd amounts almost instantly.

Dogecoin has since skyrocketed to sky-high values after Musk backed it repeatedly on social media, earning the nickname “dogefather” after his endorsement triggered a 26,000 per cent increase in the past year.

But even the emphatic billionaire has warned against diving into the complex trend without a lifeboat.

“Cryptocurrency is promising, but please invest with caution!” he tweeted on Friday morning.

“First of all, I think people should not invest their life savings in cryptocurrency to be clear. I think that’s unwise.”

He added that “there’s a good chance” crypto becomes the main currency on Earth, but no one knows which digital coin will become the most prolific.

He added that putting money in it “should be considered speculation at this point”.