British Banks Limit Crypto Companies — Lawmakers Demand Answers

UK lawmakers have demanded that the country's largest banks explain why cryptocurrency companies continue to face difficulties opening accounts and making payments. Letters were sent to the heads of all major UK banks.

The move was prompted by numerous complaints from crypto companies. According to the All-Party Parliamentary Group on Crypto and Digital Assets (APPG), businesses are being refused account openings, and some banks are restricting or blocking payments related to cryptocurrencies.

Banks Must Explain Their Policies

Lawmakers want to find out how banks make decisions about working with crypto companies and how justified the current restrictions are. At the same time, they acknowledge that financial institutions have an obligation to combat fraud, money laundering, and other financial crimes.

The main dispute is about something else: whether banks should assess each company individually or restrict entire categories of customers just because they work with cryptocurrencies.

The MPs themselves warn that problems with banking services could become one of the main obstacles to the growth of the UK crypto sector. Without a regular bank account, it is harder for companies to accept customer money, pay employees and suppliers, and grow their businesses.

The UK Attempts to Mix Cryptocurrencies and Traditional Banks

The situation has become particularly noticeable against the backdrop of the new UK cryptocurrency regulatory framework being prepared. The government has already acknowledged the problem and stated that companies authorised by the Financial Conduct Authority (FCA) should not face banking restrictions just because they work with digital assets.

Now the parliamentary group is collecting data from banks, crypto companies, payment services, and regulators. Submissions will be accepted until 31 August, after which MPs plan to publish their findings and recommendations. No new obligations for banks are being introduced at this time.

The key question for the UK market is whether it will be possible to simultaneously maintain strict control over financial risks without blocking legal crypto businesses' access to the traditional banking system.

Source: CryptoUK, UK Parliament