Barclays, HSBC Block Accounts of Crypto Traders

Aug 27, 2018 at 08:03 Update Date :Aug 27, 2018 at 08:03 UTC

UK-based banking giants Barclays and HSBC blocked the accounts of a company after the owner used his personal account and info to make transactions in a crypto-trading platform.

The company is called 50cycles and has been providing customers with electric bicycles since 2003. It currently has outlets in Shoreham-by-Sea, Loughborough, and even London.

Scott Snaith, CEO of 50cycles, explained that he discovered that he could no longer access his accounts in the respective banks after making some big BTC transactions with Finland-based exchange LocalBitcoins. Snaith maintains that his transactions were “entirely transparent and above board”, and the individuals he traded with were citizens of the UK with verified IDs. Furthermore, he says that the transactions were completed through only his private account, and not his business account (they are, however, linked). He has since been turned down by HSBC, but told by Barclays to get hold of legal advice.

Banks all over the world have a history of making such decisions. Earlier this year in January, the Gibraltar International Bank received a circular from the Royal Bank of Scotland that the latter would not be handling crypto-transactions, and the bank would have to look for a partnership elsewhere. UK head of eToro and CryptoUK chairman Iqbal Gandham said to reporters, “The moment you mention crypto to a bank, it’s like you are a drug dealer.”

Then, in March, the Bank of Montreal began shutting down the processing of crypto-transactions from its credit/debit services and also it’s online banking service, stating the volatility of such currencies as the reason. The bank has earlier agreed to partner with a new crypto-exchange by the Toronto Stock Exchange owner and has made the new decision in spite of this agreement.

Similarly, Barclays has also begun servicing US crypto-exchange Coinbase since March.

Snaith explained to reporters:

“I’ll never be able to bank with Barclays again. I’m a professional business owner taking advantage of new financial technologies and it looks like the banks are failing to keep up with their customers’ habits…The message is clear: your funds are not yours.”

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