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Due to rising financial crimes related to cryptos, banks in the UK are blocking payments to cryptocurrency exchanges. According to the Telegraph, Barclays, Starling, and Monzo have blocked payments to Binance and SwissBorg with the primary motivation being surging cryptocurrency fraud.
Starling, the Goldman Sachs-backed online bank, has enforced the greatest amount of limitations by halting all payments to crypto exchanges. According to the bank, this step had become a necessity given the “high levels of suspected financial crime with such payment.”
On the other hand, banking giant Barclays continues to assert that their customers are not suspended from making payments to cryptocurrency exchanges.
While Barclays states that users are not blocked from making payments, customers say otherwise. One of the bank’s customers tweeted that they were locked out of the account after attempting to transfer funds to Binance. They said: “It took two 90-minute phone calls to be able to get the transfer done.”
Now the banks do not want us swapping fiat for crypto. They’re doing all they can to prevent us making more returns on our investments. I only want to buy more #Cardano @IOHK_Charles 👀 pic.twitter.com/3AXJvPAFnw
— Crypto₳d₳ (@CryptoCardano_) May 22, 2021
UK Going Hard on Crypto
Crypto enthusiasts claim that the UK is building upon the “crypto & crime” cliché to attack the success of this industry and rationalize stringent regulations.
The Financial Conduct Authority (FCA) previously warned cryptocurrency traders to be prepared for losing all their funds due to the high volatility of this industry. Being the main supervisor of anti-money laundering and counter-terrorist financing (AML/CTF) in the UK, the FCA also requires all UK-based crypto exchanges to stay compliant with money laundering regulations.
In recent news, the Advertising Standards Authority (ASA) increased ad restrictions on cryptocurrency exchanges, blocking Bitcoin-promoting advertisements by the crypto firm Luno. This is not the first time that the ASA has tried to regulate cryptocurrency advertisements. Back in 2020, the regulator introduced guidelines for the promotion of crypto-related ads. Under these guidelines, crypto exchanges were required to clearly state that the space is speculative in nature and contains a risk of losing money.
Intensified regulations and blocked payments due to surging crypto-related fraud are currently posing as a disincentive for new investors. Because of this, the future of crypto space in the UK might be in jeopardy.