HSBC and Nationwide Latest To Limit Crypto Purchases
(Kitco News) – The crypto and banking industries have become more estranged as of late, as two leading U.K. banks have announced new restrictions on customers who wish to buy crypto assets.
Bloomberg was the first to report on the story Thursday, noting the move was due to warnings issued by U.K. regulators and the industry’s struggles over the last eighteen months. Customers were informed of the changes via email, which read “We’ve set some limits on buying cryptocurrency with your card. These will apply where we identify payments to crypto exchanges.”
Adults with current accounts have a maximum daily spending limit of £5,987, and debit card payments for cryptos are no longer accepted. Credit cards are also excluded, as are Apple Pay and Google Wallet.
The restrictions affect FlexStudent and FlexGraduate accounts, as well as FlexBasic and FlexPlus. FlexOne account holders can spend up to £100 ($120) per day for crypto purchases. Any attempt to exceed this amount will result in the transaction being declined. Joint accounts are also limited to daily limits.
Last month, HSBC sent out an email to customers informing them they could not buy crypto with their credit cards. The statement read “From 23 February 2023, we’ll no longer allow cryptocurrency purchases using our credit cards. This is because of the possible risk to you. The Financial Conduct Authority has warned that cryptocurrencies are not regulated, and they’re not protected by any kind of legal or financial compensation scheme.”
The U.K. banking sector has been stepping up its efforts to limit cryptocurrency purchases and transactions, with HSBC and Nationwide recently joining a growing list of institutions restricting the use of crypto services. The move comes as global regulators voice heightened concerns about the risk posed by cryptocurrencies.
In August 2021, HSBC announced it would be banning credit card payments to Binance, the largest crypto exchange in the world. This decision was taken due to the uncertainty around the regulatory status and integrity of the exchange.
The U.K. is also set to publish a proposed regulatory framework for cryptocurrencies. The framework aims to promote growth and innovation, while also ensuring the safety of investors.
Britain’s Financial Conduct Authority (FCA) is also cracking down on illegal crypto ATMs. The FCA has proposed that crypto executives who break rules related to the promotion of digital currencies could face up to two years in prison.
The warnings and enforcement actions from global regulators have become increasingly frequent since the collapse of FTX, with the Financial Stability Board, International Monetary Fund and Financial Action Task Force all issuing warnings to banks about the potential dangers posed by cryptoassets.
Disclaimer: The views expressed in this article may not reflect the opinions of the author. The author has taken all reasonable steps to ensure the accuracy of the information but cannot guarantee it. This article is for informational purposes only and should not be considered a solicitation for any exchange of commodities, securities or other financial instruments. The author of this article and Kitco Metals Inc. are not liable for any losses or damages that may arise from this publication.
