Barclays Bank is informing customers it will no longer allow debit or credit card payments to crypto exchanges, including Binance. The decision was disclosed earlier this week, following a June 23 decision from the United Kingdom’s Financial Conduct Authority (FCA) targeting Binance Markets Limited. The bank communicated the new policy directly to clients, stating it was implemented “to help keep your money safe.” In a message posted to social media, Barclays said: “We’ve made the decision to stop payments made by credit/debit card to Binance until further notice.” The restriction does not impact users’ ability to withdraw funds from Binance, but blocks customers from making any crypto transactions via the bank’s credit cards. Barclays is directing customers to the FCA website for additional information about investing in crypto assets, particularly Binance. FCA Binance warning causes crypto banking hiatus Barclays’ decision comes against the backdrop of the FCA’s public notice on Monday, in which the regulator barred Binance Markets Limited from offering any regulated financial services within the UK as from June 27. Barclays FAQ on crypto transactions. Source: Barclays Bank website The FCA has repeatedly issued cautions over the risks of crypto investments, particularly through online platforms and social media advertising that promise high returns. “Be wary of online and social media advertisements that promise high returns on investments in crypto assets or related products,” the FCA wrote in its statement. The authority does not regulate assets like Bitcoin or Ether directly, but it oversees certain crypto derivatives and tokens that fall under its definition of securities. Binance responded to the FCA’s announcement by insisting that Binance Markets Limited is a distinct legal entity from Binance.com. Crypto fraud prompts bank policy change According to the FCA, crypto platforms are being used for illicit activities in organized fraud networks. Criminals exploit crypto exchanges to convert stolen funds into digital assets, making them harder to trace. UK consumers lost over £75 million to scams originating on social media, according to the watchdog. The FCA had already banned Binance Markets Limited from operating in the UK back in June 2021 due to its failure to comply with regulatory obligations. That ban remains in effect today. In response, many UK banks have moved to block customer transfers to crypto platforms. A recent industry assessment shows that approximately 47% of major UK banks offer no support for cryptocurrency transactions. Of these, at least seven institutions, including high-street banks, prohibit both transfers and debit or credit card purchases involving digital assets. Banks have lambasted crypto platforms like Binance, Kraken, Kucoin, and Coinbase for allegedly failing to enforce adequate safeguards against money laundering. They argue that the lack of transaction tracking allows criminals to use the platforms for illicit financial flows. Binance and Kraken have firmly denied the accusations, reiterating that they implement anti-money laundering procedures and are committed to protecting users from fraud. Barclays joins others such as TSB, The Co-operative Bank, and Santander in fully blocking transfers to all crypto exchanges. A Binance spokesperson said the company was “disappointed that Barclays appears to have taken unilateral action based on what appears to be an inaccurate understanding of events.” The spokesperson added that Binance.com is still operational and accessible to UK residents, despite the regulatory action taken against Binance Markets Limited. The Bank of England is preparing to release new guidelines for banks’ exposure to digital assets, expected to take effect by 2026. Last week, David Bailey, executive director of prudential policy at the Bank of England, talked about the proposals during a speech at the Risk Live Europe conference in London. He noted that regulators now prefer adding restrictive limits to digital assets, until more evidence is available. Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now
