HSBC Bans Customers From Purchasing Crypto With Credit Cards• March 3, 2023 3:33 pm • Comments
The UK’s largest bank, HSBC Holdings, just made an announcement that they will be banning customers from purchasing crypto with credit cards.
This is quite the revelation given that this will significantly impact the number of people that can acquire digital assets.
Many investors and speculators believe that this may be a move where the traditional financial system is trying to slow the adoption of crypto as it does not benefit their existing financial model.
It also turns out that HSBC is not the only bank that has decided to do this, but another bank called Nationwide has also revealed to have done the same thing.
Whether or not other banks in the region will follow this trend is still to be determined, but it is certainly is a new issue that may slow the growth of the market.
Nationwide is applying daily limits of £5,000 ($5,965) on debit-card purchases, while credit cards will no longer be available for crypto transactions. https://t.co/4ptmbvCy6v
— Cointelegraph (@Cointelegraph) March 2, 2023
HSBC has barred customers from making cryptocurrency purchases. Alternatively, Nationwide is imposing a £5,000 daily limit on cryptocurrency purchased with a debit card. Moreover, Bloomberg notes that action arrives “after industry scandals and regulatory warnings.”
The last few weeks have seen regulation ramp up, specifically in the United States. As the US Securities and Exchange Commission (SEC) has orchestrated a greater effort in regulatory enforcement, the industry is attempting to find a clearer way through in terms of policing the growing digital asset industry.
Now, English banks are starting to react to certain regulatory concerns in the industry.
Specifically, the UK’s largest bank, HSBC Holdings bans customers from purchasing crypto with their credit cards.
The banks stated that the reason for the ban is because of “the possible risk” that it poses to consumers.
However, it seems to be quite the over-reaction given that consumers should be able to decide the level of risk that they take with their purchases.
Others also believe that the banks have done this due to regulatory pressure from the Financial Conduct Authority (FCA) to limit crypto purchases.
Regardless, it is clear that the regulatory environment in the UK for crypto is not exactly the best which may eventually cause a lot of crypto firms to move outside of the region.
The FCA, similar to the SEC, has been cracking down on crypto companies recently and is being aggressive on crypto regulation.
Banks are only driven by profit. When profit drains, they ban crypto again, and crypto companies will be treated like untouchables. @yourCashaa is standing firm in support of the crypto industry. https://t.co/sx0RCv9xF7
— Kumar Gaurav (@kg_Cashaa) March 3, 2023
Authorities in the UK are cracking down on crypto companies. The FCA proposed in February a set of rules that could subject executives of crypto firms to two years in prison if they don’t meet certain conditions related to promotion.
“Cryptoasset businesses marketing to UK consumers, including firms based overseas, must get ready for this regime,” said the watchdog in a statement.
The financial authority also stated that all crypto exchange providers — including crypto ATM operators — must be registered and comply with money laundering regulations.
A highly anticipated consultation paper for the U.K.’s upcoming crypto regulation was recently released.
The proposals aim to establish the U.K.’s financial services sector at the forefront of crypto and avoid strict control measures that have gained traction worldwide. The document covers a wide range of topics, including algorithmic stablecoins, nonfungible tokens and initial coin offerings.
NEWS: UK banks HSBC and Nationwide to ban #crypto purchases with credit cards.
📰 https://t.co/iJVTndtwvR pic.twitter.com/NNyPgRPCfM
— CoinGecko (@coingecko) March 3, 2023
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