coindesk.com
The U.K.’s desire to become a global cryptocurrency hub appears to have collided with a barrier in the form of the country’s high-street banks.
More than 10,000 complaints about banking restrictions on crypto purchases were submitted by consumers over 90 days between May and August, according to advocacy group Stand With Crypto (SWC).
The country first announced its support for the industry back in 2023, when Rishi Sunak, later prime minister, was still chancellor of the exchequer for the Conservative government. That stance was reiterated by the economic secretary to the Treasury, Lucy Rigby, less than year ago under a Labour administration.
“A country cannot credibly invite innovators in while allowing banks to lock consumers out,” Katie Harries, Coinbase's head of European policy, said in an email interview. “This will undoubtedly dampen the growth of the U.K.’s digital asset sector, with ramifications for associate investment here.”
The 10,092 complaints submitted using an online tool by 9,800 individuals covered customers in all 650 parliamentary constituencies of the U.K., the SWC report said in a report.
Increased friction
The findings expose a potential contradiction in the U.K.’s approach to digital assets. While the government and Financial Conduct Authority (FCA) are preparing a comprehensive regulatory regime intended to attract crypto businesses, banking restrictions can prevent consumers from accessing even regulated venues.
"Bank transfers represent a crucial on-ramp to add money to their account on our platform," said Harries. “We are an FCA-registered crypto asset business, but are subject to the same blanket restrictions as the wider crypto asset sector."
Lloyds Banking Group, which includes Halifax and Bank of Scotland, received the most complaints with 2,297, equivalent to 23% of the total. Barclays followed with 1,569, while NatWest Group received 1,278.
The figures require some qualification. SWC collected complaints from individuals choosing to use its online tool. The poll is not a representative survey of banking customers and is not adjusted for each bank’s share of U.K. checking accounts.
As such, higher figures do not necessarily reflect a higher rate of complaints.
Harries cited research by the U.K. Cryptoasset Business Council indicating that 40% of attempted transfers to FCA-registered crypto exchanges were blocked or delayed during the preceding 12 months.
“Most exchanges said customer friction had increased, and 70% said banking conditions were more hostile than a year earlier,” she said.
Disconnect
Perhaps the report’s most revealing finding, however, is the disconnect between banks’ publicly stated restrictions and what customers say they experience.
Lloyds has no published policy restricting crypto-related transfers, according to SWC’s review of bank websites as of Aug. 28.
