The growing share of UK cryptocurrency investors has struggled to fund their accounts, highlighting the regulatory and banking hurdles facing the digital asset sector.
In an IG Group survey of a broader sample of 500 UK crypto investors and 2,000 adults, 40% of users said that the bank blocked or delayed payments to crypto providers. Of those affected, 29% complained to the bank, while 35% said they switched lenders accordingly.
When asked about a broader sample of banks intervening in crypto transactions, 42% said they opposed such measures, and 33% expressed support.
“We are causing the damage that millions of people are effectively locked out of the code just by who they are in the bank,” said Michael Healy, UK Managing Director at IG. “This type of behavior is anti-consumer at best and anti-competitive at worst. And it’s not supported by the public.”
Cryptocurrency trading is legal in the UK, but funding accounts can be a major obstacle. Crypto companies must register with the Financial Conduct Authority (FCA) as a virtual asset service provider to run their business, and only FCA certified companies can provide fiat-on-remps and off-ramps in the UK pound.
Some high street banks, including Chase UK and NatWest, are taking further steps to limit or block payments to crypto exchanges under the flag of fraud prevention.
In addition to these barriers, the FCA prohibits retail customers from using borrowed money, including credit cards, to purchase digital assets.
https://www.youtube.com/watch?v=lauxwrt0n04
Related: UK Crypto wants to stall, but there are “symptoms of encouragement”
The UK is behind in the global crypto race
The bank’s hurdles for UK crypto users come amid growing criticism of the country’s broader approach to digital assets. Former Prime Minister and current Coinbase advisor George Osborne recently warned that the UK is “lagging behind in the crypto race.”
“What I see makes me uneasy. I’m not an early adopter. We allowed ourselves to be left behind,” Osborne said of digital assets in the financial era.
sauce: Cointelegraph
Osborne has picked out the lack of progress in Stablecoins. This is a US dollar-dominated market of $288 billion and has virtually no presence from the British pound. According to Coingecko, religious stubcoins are in circulation in pounds for just $616,000.
Still, there have been some advances. As reported by Cointelegraph, the FCA recently lifted its ban on retail trading on Crypto Exchange-Traded Notes (ETN) on October 8th. Regulators said the move reflects the maturation of the digital asset sector after years of volatility and what was once considered a “lack of a need for legitimate investment.”
Related: “Everything is OK”: Coinbase mimics the UK’s financial system with new video
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