UK banks are skeptical about crypto, and it’s a problem.
In 2018, the United Kingdom’s Financial Conduct Authority wrote to the heads of the country’s biggest high street banks to emphasize the importance of due diligence when dealing with crypto businesses. That seems to have led to widespread high-risk ratings and bans on crypto-related banking, impacting both crypto businesses hoping to operate in the U.K. and investors alike.
By barring crypto businesses from accessing “mainstream” banking, organizations are forced to use payment service providers , which are rated higher risk by banks because they’re also used by the gambling industry. There’s a lack of nuance in this process, with banks tending to blanket block transactions through PSPs.When it comes to specific services such as payment handling, refusing to service crypto also harms market competition.
BCB, Revolut, Clear Junction and ClearBank all offer banking relationships or U.K. bank accounts for those involved in crypto. The fact that a limited number of PSPs are able to work with crypto businesses or investors without significant sanctions from regulators, a greater risk exposure than other organizations and with comparable compliance teams to major retail banks shows that it is possible.
processes to be able to operate and transact in the U.K. — so there need to be effective banking relationships to enable that.
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