Starling Bank bans cryptocurrency purchases and deposits due to danger

UK-based digital bank Starling is the latest financial institution to ban its cardholders from engaging in cryptocurrency-related transactions or activities.

Starling customers will no longer be able to make purchases of cryptocurrencies such as Bitcoin (BTC) or receive incoming transfers from cryptocurrency exchanges or stores that accept Bitcoin as a form of payment.

The online bank made the announcement to its clients as well as on Twitter, citing the perceived high risks associated with trading cryptocurrencies as the reason for the decision.

The bank took these steps amid an ongoing crisis in the cryptocurrency business involving FTX, one of the world’s largest cryptocurrency exchanges, accused of misappropriating client cash along with its sister company, Alameda. .

According to documents filed by FTX in its bankruptcy proceedings, the company owes more than $3 billion to its 50 largest creditors, and the total number of investors who are creditors appears to exceed a million.

This is not the first time that Starling has implemented limits on activities linked to cryptocurrencies and blockchain technology.

In May 2021, the bank temporarily blocked payments to cryptocurrency exchanges due to similar concerns. The bank cited “high levels of suspected financial crime with payments to some cryptocurrency exchanges.” as a reason for the temporary stoppage.

The ban comes just a few weeks after Santander UK restricted customer contributions to cryptocurrency exchanges to a maximum of £1,000 ($1,196) per transaction and £3,000 ($3,588) in total per month.

According to recent reports, several other British banks have completely banned cryptocurrency-related transactions.

In June 2017, TSB bank restricted the ability of its 5.4 million customers to buy bitcoin.

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