UK Bank to Cease Serving Customers Dealing With Cryptocurrencies
A UK-based bank, NatWest, will reportedly halt serving customers who accept payments in bitcoin and other cryptocurrencies. The institution referred to recent warnings highlighted by the country’s financial regulator and said dealing with digital assets contains high risk.
UK Bank Stops Working With Crypto Users
According to The Guardian coverage, National Westminster Bank, known as NatWest, plans to bar serving all customers accepting crypto payments. Morten Friis, the bank’s head of risk committee and board member, categorized the institution’s move as “taking a cautious approach” towards the crypto ecosystem.
“We have no appetite for dealing with customers, whether taking them on as new clients or having an ongoing relationship with people, whose main business is backed by an exchange for cryptocurrencies or otherwise transacting in cryptocurrencies as their main activity.” – Friis indicated during a shareholder event.
The board member outlined “high risks” associated with cryptocurrencies and the lack of clear regulations as the primary reasons for the bank’s retreat.
NatWest’s decision comes in a compelling moment, and it actually contrasts with the predominant approach undertaken by banks across the ocean.
US-based banks, led by BNY Mellon, Morgan Stanley, JPMorgan Chase & Co, and even Goldman Sachs, have been significantly more opened to the idea of dealing with digital assets. Some went even further and enabled direct access to cryptocurrencies for their institutional clients.
FCA’s Recent Crypto Warnings
NatWest’s refusal to operate with cryptocurrency businesses and customers associated with the industry comes shortly after UK’s financial regulator issued a list of potential risks linked to digital assets.
As CryptoPotato reported in early 2021, the Financial Conduct Authority (FCA) warned investors about the highly volatile nature of crypto assets. The watchdog said people allocating funds in the industry should “be prepared to lose all their money.”
The FCA was particularly expressive against shady projects with affiliations to the crypto ecosystem that promise exceptionally high returns if users invest through them.
Additionally, the regulator banned the sale, marketing, and distribution of crypto derivatives and exchange-traded notes (ETNs) for all customers as of January this year as well.
