HSBC and Nationwide have announced new restrictions on buying cryptocurrencies in the United Kingdom, citing a warning from the Financial Conduct Authority (FCA), the U.K. regulator that oversees the financial services industry, about the risks involved in buying cryptocurrencies.
The National Building Society purportedly sent an email to its clients on Thursday, Feb. 28, informing them of the new restrictions on cryptocurrency purchases. “We will introduce restrictions on buying cryptocurrencies from February 28,” the email shared by multiple people said, and that “the Financial Conduct Authority (FCA), which regulates the financial services industry, has highlighted certain risks associated with buying cryptocurrencies.” related.”
The email goes on to explain that Nationwide will place limits on card payments from checking accounts to cryptocurrency exchanges, with a daily new card limit of £100 for Flexone accounts and £5,000 for other checking account types. Additionally, Nationwide will not allow payments to cryptocurrency exchanges using Nationwide credit cards. Neither the primary cardholder nor any other cardholders can use the Nationwide credit card to purchase cryptocurrency.
HSBC also announced the restrictions on cryptocurrency purchases in an email, which some claim to have received on Twitter. According to the email, HSBC will no longer allow cryptocurrency purchases with its credit cards starting February 23, 2023. The email emphasizes that “this is because you may be at risk. The Financial Conduct Authority warns against investing in crypto assets as they are considered high-risk speculative investments.”
HSBC has previously taken an anti-cryptocurrency stance when it comes to allowing customers to buy cryptocurrencies. However, the bank recently filed trademark applications for multiple digital currencies and Metaverse products, joining the Metaverse.
The move by HSBC and Nationwide is part of a growing trend of British banks placing restrictions on cryptocurrency purchases. In November 2022, UK-based Santander and Starling Bank imposed similar restrictions on fund transfers to cryptocurrency exchanges.
Despite the popularity of cryptocurrencies in recent years, regulators and financial institutions around the world have been increasingly scrutinizing digital assets due to concerns about their potential risks, including money laundering, fraud and market manipulation. As a result, many financial institutions have been hesitant to support the use of cryptocurrencies, a trend in the UK highlighted by recent actions by HSBC and Nationwide.
As cryptocurrencies gain popularity, it remains to be seen how regulators and financial institutions will continue to adapt to this new digital asset. For now, however, UK banks appear to be growing more cautious about allowing their customers to buy cryptocurrencies.