Lloyds Banking Group is to prohibit its customers from purchasing Bitcoin and other cryptocurrencies on their credit cards from today.
The ban – which does not apply to debit cards – will affect customers of Lloyds Bank, Bank of Scotland, Halifax and MBNA.
The financial institution has made the move to avoid exposure to unpaid debts relating to customers buying cryptocurrencies – which are notorious for their price fluctuations. The value of Bitcoin, for example, surged in late 2017 but has since started to fall.
Many governments and regulators around the world remain wary of cryptocurrencies and their unproven track record.
Last September, South Korea followed China’s lead in banning Initial Coin Offerings (ICOs) – a way of raising funds from the public using the digital sale of cryptocurrencies. In the same month, the Financial Conduct Authority also issued a warning to UK consumers about the risks of ICOs.
A Lloyds Banking Group spokesperson confirmed to FStech this morning: “Across Lloyds Bank, Bank of Scotland, Halifax and MBNA, we do not accept credit card transactions involving the purchase of cryptocurrencies.
“This is a case of protecting our credit card customers from the risks associated with the price volatility of cryptocurrencies seen over recent months.”
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