Opinion divided over Bitcoin and digital money investment

Experts have warned investors to do their homework before buying digital currencies which have fallen in value in recent weeks

This week Lloyds and Virgin Money stopped customers using credit cards to buy cryptocurrencies, amid concerns they could run up too much debt.

It comes as the value of Bitcoin and other cryptocurrencies fell after a year when prices rose significantly.

Welsh lawyer and technology expert Dr Cerian Jones said potential investors should research and understand what they are getting into.

But she thinks these currencies are "here to stay" despite concerns.

• Bitcoin falls below $6,000

• Virgin Money joins Bitcoin ban

• What is Bitcoin?

Bitcoin and other cryptocurrencies are sometimes referred to as digital or virtual currencies. You can use them to buy products and services - for instance you can buy a holiday online using Bitcoin. Other cryptocurrencies include Ethereum and Litecoin.

Digital currencies are used day to day in some European countries, but at present not many shops in the UK accept them.

The value of Bitcoin has fallen sharply in recent weeks, but is worth five times more than it was a year ago.

Dr Jones, who is a partner and patent attorney specialising in the technology sector at UDL Intellectual property in Cardiff, said while she expects some of these virtual currencies to fail, and there is "a huge amount of froth out there", cryptocurrencies will continue in some form, due to their international popularity.

"In the UK we're not as far advanced as other countries. If you go abroad you will see there is much wider adoption of some of the currencies. For example Japan last year legalised [Bitcoin] as legal tender," she said.

However international opinion is divided, and the UK government is considering regulation of digital currencies because of fears they can be used for money laundering.

Welsh multimillionaire Kevin Green is sceptical and prefers well-established assets like property and gold and silver bullion.

"I feel a lot safer in the steady growth of that over the years rather than the boom and bust type of scenario that's happening with cryptocurrency.

"If the price drops, at least with property you've got something you can sell and recover. With cryptocurrency we don't know whether it's going to drop right back to nothing, disappear, that's the problem."

'I wondered if it was a joke - now I think it's revolutionary'

Adrian Cole used specialist computers to find the digital currency

Bitcoins are created through a complex process known as "mining", using computer software to solve mathematical problems in exchange for the "coins".

Rural Monmouthshire may seem an unlikely location for such a mine, but Adrian Cole was one of Wales' first producers when he kitted out a barn in 2013.

The specialist computer equipment burned through so much electricity the barn stayed constantly at 25-30 degrees Celsius and the authorities asked them what they were doing.

Technology enthusiast Mr Cole initially thought the currency was a "bit of a joke" when he learned about it in 2012 but changed his mind.

"When you start to study Bitcoin, it really makes you ask questions about economics and how money's created...When you start to really understand the technology and some of the thinking behind it, it's quite revolutionary."

Mr Cole dismantled his mine in 2014 because it was no longer cost-effective, and he now works as a cryptocurrency consultant. He said investors should be cautious as virtual currencies are not regulated.

"I would never recommend that anybody puts a large amount of their personal wealth into Bitcoin, you should treat it as an experiment and learn about it and educate yourself."