Of course, some investors—ok, speculators—may actually be attracted to the "Wild West" mentality of virtual currencies that the CFPB is warning about. Early adopters who were mining bitcoins from their parents' basements in 2011 made themselves quite a bit of (taxable) money —those first bitcoins electronically mined three years ago increased in value from $20 to more than $1,100, before losing half of that peak value. More recently, the market for bitcoins has somewhat settled, trading at a little less than $600 for most of the last three months.

But even as an investment, bitcoin is still a long way from prime time. A bitcoin based exchange-traded fund, courtesy of the Winkelvoss twins, has been in the registration stage with the Securities and Exchange Commission for months. But even if the ETF (which, if traded, will have the ticker COIN on the Nasdaq Stock Exchange) comes into being, it's far from clear what an investment in what is essentially an exotic foreign currency does for a portfolio. For individual investors, one rarely sees model portfolios with foreign currency positions, not even in those with healthy doses of alternative investments such as gold and master limited partnerships.

—Chris Horymski