Starling, a digital banking institution located in the United Kingdom has been the most recent to prohibit cardholders from engaging any cryptocurrency-related transactions.
Starling customers will not be able make Bitcoin (BTC), or receive inbound payments from crypto exchanges.
The bank announced the decision to clients and on Twitter. They cited the high perceived risks of cryptocurrency trading as the reason.
This was in the midst a crisis in the cryptocurrency industry involving FTX, one the largest crypto exchanges worldwide, and Alameda, a sister company accused of misappropriating customer funds.
According to documents filed by FTX during its bankruptcy proceeding, the company owes over $3 billion to its 50 biggest creditors. The total number of creditors for the company is also above 1 million.
Starling has not been the only one to place limits on cryptocurrency and blockchain-related activities.
The bank temporarily blocked cryptocurrency exchange payments in May 2021 due to similar concerns. “High levels of financial crime and payments to certain cryptocurrency exchanges” were the reasons given by the bank. This was the reason for the temporary suspension.
This ban follows a few weeks of Santander UK restricting client contributions to cryptocurrency exchanges to a maximum 1,000 British Pounds ($1,196 per transaction) and 3,000 British Pounds ($3,588) per month.
Recent reports have shown that many other British banks have banned all transactions involving cryptocurrencies.
June 2017: TSB Bank restricted bitcoin purchases to its 5.4 Million clients.