Fourth Bank, Lloyds Bank, Bans Customers from Buying Bitcoin with their Credit Cards
Another bank has decided to join the list of financial institutions which have decided to ban customers from buying bitcoin using their credit cards. This time, Lloyds Bank has decided to ban its customers from using their credit cards to buy cryptocurrencies. The bank has 9 million customers that will be affected by this decision.
Lloyds is the first bank in the UK to ban purchasing of bitcoin with credit cards
Lloyds operates in the UK, meaning that financial institutions' decision to stand against cryptocurrencies has expanded beyond the US, where three other banks, Bank of America, Citigroup and JP Morgan, have made similar decisions.
It has been revealed by local media that the reason why Lloyds has made this decision is linked to fact that the bank is worried that its customers could suffer big losses because of the high volatility of the digital currency and this way they can be in the situation of not being able to pay their debt.
Lloyds will allegedly inform all its customers that any attempt to purchase cryptocurrencies with the use of their credit cards will be blocked. In this context it is important to mention that the ban only affects credit cards, meaning that debit cards will not be affected and transactions involving debit cards will not be blocked.
According to the bank, the aim of this decision is just to "protect customers" from big losses and consequently from big issues. An important evolution that has come around the time of the announcement on the cryptocurrency market is that the price of bitcoin has suffered a major drop.
The cryptocurrency has fallen below the $8,000 price range, close to the $7,000 value. Of course, this might be translated into great losses for owners of the cryptocurrency, but many analysts seem to expect the price of bitcoin to grow back in a matter of days. However, this does not mean that such high volatility does not raise concerns among banks, who fear that their clients could be exposed to losses they cannot afford.