UK Banks Limit Crypto and Bitcoin Access
- The UK, like other parts of the world, has grown concerned with the recent failures of prominent crypto platforms.
- UK banks have been warned about the dangers of being exposed to cryptocurrencies.
- US-based banks with ties to the crypto industry have also faced increased scrutiny.
British banks have maintained their crackdowns on their customers’ crypto purchases. According to a new Bloomberg report, Nationwide Building Society and HSBC Holdings Plc have tightened restrictions on retail clients’ access to crypto assets in the past few days, making them the latest UK banks to do so in response to crises in the crypto sector and regulatory concerns.
On Wednesday, the building society reportedly informed customers that Nationwide is imposing daily limitations of £5,000 ($5,965) on debit-card purchases of crypto assets. Remarkably, Nationwide has halted using its credit cards to purchase cryptocurrency. Furthermore, HSBC said it stopped allowing consumers to use its credit cards to buy cryptocurrency in February. HSBC said the decision was made “because of the possible risk to customers.”
Both British banks cited warnings issued by the country’s Financial Conduct Authority, which describes cryptocurrencies as high risks. Nationwide and HSBC join other UK institutions such as Banco Santander SA, Lloyds Banking Group Plc, and Natwest Group Plc as organizations that have recently restricted UK consumers’ access to some cryptocurrencies. Some of these institutions recently rolled out new policies that appear to be aimed at Binance, a cryptocurrency exchange.
Banks in the UK are said to be cautious about the risks of cryptocurrency. These concerns have been spurred by the collapse of the cryptocurrency exchange FTX in November. Banks have been repeatedly advised not to expose themselves to the risks that crypto-assets potentially represent to the established financial system.
Questions about whether cryptocurrency companies provide adequate customer protection have been further raised in light of recent criminal charges brought against Sam Bankman-Fried, the former CEO of FTX. Bankman-Fried is accused of giving Alameda Research, FTX’s sister trading platform, unrestricted access to customer funds for its own use while also borrowing money from the company for his own benefit.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
