The bitcoin ban, starting today (5th February 2018), applies to Lloyds Bank, Bank of Scotland, Halifax and MBNA customers.
Bitcoin ended last week down 30% at $8,291.87 – its worst week since April 2013 and far below the $19,000 it reached last November. However, the cryptocurrency is still ahead of the $1,000 it was trading at this time last year.
Police have warned that digital currencies remain popular among criminals as they can use them to evade traditional money laundering checks and other regulations.
Banking group fears cryptocurrencies’ falling value could leave it with huge debt hence issues directives to its credit owners against buying cryptocurrency.
The ban, which comes into effect today across all of the British banking giant’s brands, will mean cryptocurrency exchanges are blacklisted by the bank, preventing customers from taking on debt to buy the volatile assets.
As said by a Lloyds spokesperson, “Across Lloyds Bank, Bank of Scotland, Halifax and MBNA, we do not accept credit card transactions involving the purchase of cryptocurrencies.”
So, as we know, Britain’s biggest bank has become the first to announce a ban on customers using credit cards to buy Bitcoin amid fears they could run up huge losses.
Lloyds Banking Group will on Monday(today) tell its 9 million credit card customers that it will block any attempts to buy Bitcoin after the digital currency lost more than half its value in just two months.
The ban will not cover debit card transactions but will prevent customers from using credit to speculate on the price of cryptocurrencies amid fears the bubble may be bursting.
Check what this announcement has had an effect on Bitcoin prices: https://www.express.co.uk/finance/city/914520/Bitcoin-price-LIVE-falling-latest-ripple-ethereum-blockchain-lloyds-bank-credit-card
Other British banks are expected to follow suit over the coming weeks after several of the biggest US banks including JP Morgan, Bank of America and Citigroup all confirmed plans to block attempts to buy digital currencies.
A spokesman for Lloyds said the decision was made to “protect customers” in what is thought to be a pre-emptive move to reduce the risks that come with the volatile cryptocurrency.
The news comes amid growing international concerns about how the increasingly popular cryptocurrencies are being used, with fears some people are using them to launder money.
So, is the future of cryptocurrencies still bright?