In a significant move that has sent ripples across the financial sector, Chase UK, the British arm of JPMorgan, has announced stringent restrictions on cryptocurrency-related payments.
Effective from October 16, Chase UK customers will face hurdles if they attempt to make any bank transfers or card payments linked to cryptocurrencies.
This decision comes in the wake of a notable surge in cryptocurrency-related scams targeting UK consumers. Chase UK’s proactive measure aims to safeguard its customers from potential fraud, reflecting a growing concern among financial institutions about the risks associated with digital currencies.
A spokesperson for Chase UK confirmed the authenticity of an email sent to its customers, which read, “If we think you’re making a payment related to crypto assets, we’ll decline it.” The email further suggested that those still keen on investing in cryptocurrencies might consider using a different bank or provider.
Recent data from Britain’s fraud reporting agency, Action Fraud, paints a concerning picture. The value of crypto fraud in the UK witnessed a staggering 41% increase last year, reaching an all-time high of £306 million (approximately €352 million). Such scams are part of a broader fraud “epidemic” that accounted for 40% of all reported crimes in England and Wales in the previous year.
Chase UK’s decision is not an isolated one. Several other banks in the country have been tightening their policies around cryptocurrency transactions. Earlier this year, NatWest introduced daily and monthly limits on cryptocurrency exchanges to shield its customers from significant financial losses.
Similarly, HSBC declared that its customers would no longer be able to purchase cryptocurrencies using their credit cards. Other financial giants, including British neobank Starling and Santander UK, have gone a step further by completely prohibiting the buying and selling of cryptocurrencies on their platforms.
The regulatory landscape for cryptocurrencies in the UK and Europe remains a complex and evolving one. While digital currencies like Bitcoinand Ether are largely unregulated, officials are actively exploring ways to enhance oversight over their sale and distribution. Starting September 1, 2023, crypto businesses operating in the UK will be mandated to collect, verify, and share information about crypto transfers, aligning them more closely with traditional bank transfer protocols.
On a broader scale, the European Union Parliament, in May, reached a consensus on the world’s first comprehensive set of rules to regulate cryptocurrency transfers. This initiative aims to clamp down on money laundering and illegal transfers within the EU bloc.