British banks join a growing list of the country’s financial institutions tightening restrictions on digital assets.
UK banks HSBC Holdings and Nationwide Building Society ban credit card purchases of cryptocurrencies for retail customers. In doing so, they join banks in the country that are tightening their rules on buying cryptocurrencies.
A Bloomberg March 2 reports that the move is in response to warnings from UK regulators and scandals surrounding the crypto industry. Nationwide is reportedly imposing a daily limit of 5,000 British pounds (2.1 million forints) on debit card purchases of crypto assets, while credit cards will no longer be available for crypto transactions.
As of last month, HSBC customers have been unable to purchase cryptocurrencies with their credit cards. “The reason for this is the possible risk affecting customers” HSBC wrote in an email seen by Bloomberg. In both cases, the banks cited warnings issued by the Financial Conduct Authority (FCA), highlighting the risks associated with crypto-assets.
In the UK, banks such as Santander, Natwest Group and Lloyds Banking Group are also restricting access to cryptocurrencies. Most of the restrictions are aimed at the Binance crypto exchange. HSBC banned credit card payments to Binance in August 2021, citing concerns about the exchange’s local regulatory status.
Authorities in the UK are cracking down on crypto exchanges. In February, the FCA proposed a set of rules that could punish the heads of crypto companies with up to two years in prison if they fail to meet certain promotion-related conditions.
The financial authority also said that all crypto exchange providers, including operators of crypto ATMs, must be registered and comply with anti-money laundering regulations.
The much-anticipated consultation document on the UK’s upcoming crypto regulation was recently published. According to this, the island country will want to be at the forefront of cryptocurrencies, avoiding the strict control measures that are gaining ground worldwide. The document covers several topics, including algorithmic stablecoins, non-fungible tokens, and ICOs.