UK Lawmakers Question Banks Over Crypto Service Restrictions

UK lawmakers are asking major banks to explain how they decide whether to provide services to cryptocurrency and digital asset firms.

Gurinder Singh Josan MP and Lord Ed Vaizey, co-chairs of the Crypto and Digital Assets All-Party Parliamentary Group, have written to the CEOs of major UK banks about difficulties crypto businesses face when opening accounts and accessing banking services. The group is already conducting an inquiry into the issue.

The letter asks banks to explain their policies for serving crypto businesses and the restrictions they place on crypto-related payments and transactions. HSBC, NatWest, Monzo, and Nationwide, among others, have introduced limits on transfers to crypto exchanges, while some other lenders have taken stricter measures.

The parliamentarians acknowledge that banks have obligations around financial crime and consumer protection. They argue, however, that decisions should increasingly be based on the risk profile of individual firms rather than the sector they operate in.

As the UK prepares to introduce its new regulatory framework for crypto businesses, lawmakers warn that limited access to banking could make it harder for licensed firms to grow and could affect the UK's ability to attract investment to the digital asset sector.

The parliamentary group is seeking input from banks and other stakeholders before publishing its findings and recommendations.