According to a recent report from The Telegraph, three UK banks, Barclays, Monzo, and Starling have halted payments to cryptocurrency exchanges like Binance and SwissBorg. The banks cite concerns regarding crypto-related financial crime as the primary motivation for this action.
Among the banks, the Goldman Sachs-backed online bank Starling has implemented the greatest amount of limitations by suspending all payments to crypto exchanges. Starling mentioned that it has recently discerned “high levels of suspected financial crime with such payment.”
A Starling spokesman told The Telegraph that these restrainments are temporary and are aimed at protecting customers. “This is not just an issue for Starling, but for all banks. We apologise for the inconvenience that this has caused for some customers; we will be reversing this measure as we roll out additional checks specifically for payments to crypto exchanges,” he added.
Starling has a no-rush policy towards cryptocurrencies. The bank’s CEO Anne Boden, earlier this month, told Sifted that they are not seeing much demand for crypto. “Some fintechs are rushing into crypto. That’s not the Starling way. Our approach is discovering what customers want and need,” he said.
Barclays, a banking giant based in the UK, asserts that its clients are not blocked from crypto exchanges. Though, its customers say otherwise. One of the bank’s clients used Twitter to share that he was locked out of its account after attempting to send a large amount to Binance. “Took two 90-minute phone calls to be able to get the transfer done,” they said.
I had same problem with my UK bank @Barclays , as soon as I made a big transfer to Binance they locked me out of my online banking and cancelled the transfer. Took two 90 mins phone calls to be able to get the transfer done.
— cryptophil (@cryptophilbkk) May 22, 2021
Last week, another British banking giant NatWest informed its clients regarding crypto-related scams. The bank stated it had received plenty of complaints concerning fraud in the crypto industry. Nevertheless, it is still uncertain if the bank plans to flag cryptocurrency exchanges as suspicious.
Hard On Crypto
The UK has been using the “crypto & crime” cliche to attack the viability of cryptocurrencies and rationalize its intensified regulations. The country’s Financial Conduct Authority (FCA) had previously warned crypto traders that they should be prepared to lose all their money. FCA also required all the UK-based crypto exchanges to register under money laundering regulations.
Just recently, the UK’s advertising watchdog—Advertising Standards Authority (ASA)—injected increased ad restrictions, blocking Bitcoin-promoting advertisements by the popular crypto exchange firm Luno. It was not the first time for ASA to try to regulate crypto-ads. Back in 2020, the regulator implemented a set of guidelines for crypto-promoting ads, requiring them to clearly state that the space is speculative and contains the risk of losing money.
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