The UK is following in the footsteps of the US, and some banks are now introducing a ban of purchasing Bitcoin with your credit card. Lloyds Bank, Halifax and Bank Of Scotland are among those who have banned the practice.
The Lloyds Banking Group, which subsequently runs Halifax, Bank of Scotland, MBNA and Lloyds have all banned their customers from purchasing any Bitcoins with their credit cards. Spokesperson for the group said;
“We do not accept credit card transactions involving the purchase of cryptocurrencies.”
They are the first banking chain in the UK to implement such a ban, and there is a concern that others might follow in their footsteps. The reason behind this is the work that people will borrow large amounts of cash on their credit cards, assuming they’ll make a lot from their investment, but then be saddled with a huge debt, thanks to Bitcoins highly fluctuating and volatile price.
Take last year for example. In the latter stages, Bitcoin hit an all time high, which caused the attention and popularity to grow greatly, but because of the sudden increase in investors who wanted to make a money quickly. This inevitably then caused the value of Bitcoin to crash early this year, and served as a painful reminder of just how volatile the prices are.
This move follows a similar ban from US Financial Institutions. Credit cards that have been issued by Bank of America, JP Morgan Chase, and Citigroup can no longer be used to purchase Bitcoin, for the same reason.
This also comes at the time that politicians are deciding what regulations should be in place when it comes to cryptocurrencies. Teresa May, said;
“In areas like cryptocurrencies, like Bitcoin, we should be looking at these very seriously, precisely because of the way they can be used, particularly by criminals.”
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