Two UK companies have announced restrictions on cryptocurrency payments for their customers, putting further pressure on the struggling digital asset industry
On Tuesday, NatWest, one of the country’s biggest consumer banks, has put restrictions on consumers who transfer money to cryptocurrency crypto trading platforms to protect them from losing significant sums of money, the Financial Times reports.
This development will likely put more pressure on the battered digital asset industry, which has been struggling to find regulated financial partners.
At the same time, Paysafe, an online payment provider, is also winding down its services to UK customers of Binance, the world’s largest cryptocurrency exchange, citing the regulatory challenges in the UK. Binance claims that Paysafe’s decision will only affect less than 1% of its users.
Moreover, the UK’s largest banks are increasing the pressure on crypto investors. For example, HSBC announced last month that customers could no longer use their credit cards to purchase cryptocurrencies.
The relationship between crypto and regulated financial institutions has always been tenuous. Now, UK’s regulatory environment in relation to cryptocurrency is becoming increasingly challenging, leading many crypto companies to search for new partners overseas. The US banking industry is also facing similar challenges, with crypto companies struggling to find banking partners.
With the failure of US banks that were once popular routes for crypto companies to convert digital tokens to hard currency, the search for new banking partners willing to accept crypto business has become even more urgent.
Meanwhile, the U.K. government is said to be planning to create a new task force, which will bring together the Bank of England and the Treasury to coordinate the UK’s approach to central bank digital currencies.