Application rejection, account freezing, and paperwork overload are just a few of the difficulties faced by cryptocurrency businesses.
According to many sources consulted by Bloomberg, cryptocurrency firms are having trouble using banking services in the United Kingdom. The few banks who are still dealing with crypto companies are asking for more proof and details regarding their monitoring system for client transactions.
Applications being denied, accounts being frozen, and mountains of paperwork are all difficulties. Due to the recent deterioration of the situation, cryptocurrency firms have even protested to Prime Minister Rishi Sunak’s administration. The decision runs counter to Sunak’s goals of prioritising financial technology disruption and establishing the U.K. as a major worldwide centre for cryptocurrencies.
A rising number of banks in the nation have tightened regulations on digital assets, including HSBC Holdings and Nationwide Building Society, which prohibited retail clients from purchasing cryptocurrencies using credit cards earlier in March.
In order to address banks restricting or forbidding transactions with cryptocurrency companies, the self-regulatory trade group CryptoUK recommended the formation of a “white list” of registered businesses in the nation in March. Several of the biggest U.K. banks have already implemented prohibitions or limits, and according to CryptoUK, more banks and payment service providers (PSPs) could soon follow suit. “We think that right now, government action is necessary.”
The U.K. government is strengthening controls on cryptocurrency firms, just like the US government has. The Financial Conduct Authority put up a series of regulations in February that, if they aren’t followed, may result in leaders of cryptocurrency companies doing two years in prison.