Consumer-focused UK bank NatWest is imposing a limit on the amount of money customers can transfer to cryptocurrency exchanges, in a sign of deteriorating relations between digital asset firms and financial institutions.
NatWest recently said users of the bank would be limited to payments of 1,000 British pounds ($1,218) per day and 5,000 British pounds ($6,090) over a 30-day period. blog post,
The bank cited fraud and scam risks as the reason behind the decision. “NatWest is boosting customer protection against crypto-criminals after consumers lost £329 million last year,” the bank said.
Specifically, NatWest claimed that men over the age of 35 are most at risk because they are less willing to make risky investments. The bank said that promises of high returns also entice users to invest in crypto Ponzi schemes.
“We have seen an increase in the number of scams using cryptocurrency exchanges and we are working to protect our customers,” Stuart Skinner, head of fraud protection at NatWest, said in a comment.
In fact, the crypto industry about $4 billion in damage According to a report by Web3 bug bounty platform Immunefi, the value of digital assets succumbed to hacks, frauds, scams and rug-pulling last year. However, the report states that frauds, scams and rug-pulling comprised only 4.4% of the total losses.
Major banks around the world have been falling out of favor with the crypto sector in recent months. In the UK, HSBC and Nationwide Building Society implemented earlier this month restricted the ability of its customers to buy cryptocurrencies.
Other major UK institutions that have banned crypto-related businesses over the past few years include Banco Santander SA, Lloyds Banking Group PLC and NatWest Group PLC.
Regulators around the world, including the International Monetary Fund (IMF) and the Financial Action Task Force (FATF), have consistently cautioned banks against facilitating crypto purchases, due to the perceived risks cryptocurrencies may pose to the traditional financial system.
Paysafe Blocks Payments to Binance
In a separate announcement, Paysafe, an online payment provider, Said It will shut down services for UK customers of the world’s largest crypto exchange, Binance.
This has forced Binance stop deposits and withdrawals In British Pounds for new customers, while existing customers have until May 22 to transact in the currency.
“We have concluded that the UK regulatory environment with respect to crypto is too challenging to offer this service at this time, and it is therefore a prudent decision on our part,” Paysafe said in a statement.
Meanwhile, Binance has recently been under investigation in the US. As reported earlier this month, Senators Elizabeth Warren (D-Mass.), Chris Van Hollen (D-MD), and Roger Marshall (R-Kansas) Asked Binance and its US partner Binance.US to provide detailed information about their business operations amid allegations of illegal practices.
Furthermore, Binance has been under investigation by the US Department of Justice (DOJ) since 2018. The investigation reportedly focuses on money laundering conspiracy, unlicensed money transfer and violation of criminal sanctions.