NatWest, a UK-based bank, announced that it would stop accepting customers who consider bitcoin and other cryptocurrencies as payment. NatWest is one of the UK’s leading banks. It is a subsidiary of the NatWest corporation, which also comprises the Royal Bank of Scotland. Dealing with digital properties carries a high risk. Citing recent alerts from the country’s financial regulator, the organization says trading with digital properties carries a high risk.
“We have little interest in working with consumers, whether as potential clients or in maintaining a long-term partnership with people whose primary business is backed by a cryptocurrency exchange or otherwise transacts in cryptocurrencies,” said Morten Friis, head of risk committee during the Guardian coverage.
According to the board member, the bank’s withdrawal is due to “high risks” involved with cryptocurrencies and a lack of specific legislation.
NatWest’s decision came at an interesting time, and it differs from the stance taken by other banks on the other side of the Atlantic.
Banks headquartered in the United States, such as BNY Mellon, Morgan Stanley, JPMorgan Chase & Co, and even Goldman Sachs, have become far more open to working with digital properties. Some also went so far as to offer their institutional clients direct links to cryptocurrencies.
NatWest is obviously on the other end of the continuum, meaning that if a client holds bitcoin, they might be subjected to further financial fraud tests.
The Financial Conduct Authority (FCA) has issued an alert to investors about crypto assets’ high volatility. According to the watchdog, people who invest in the industry should “be prepared to risk all of their money,” according to the watchdog.
The FCA was especially vocal about dubious ventures with ties to the crypto ecosystem that offer exorbitant returns to users who invest in them.
Additionally, as of January this year, the regulator prohibited the acquisition, marketing, and issuance of crypto futures and exchange-traded notes (ETNs) to all consumers.