Lloyds Banking Group bans customers from buying virtual currencies on credit cards

Bitcoin buys banned by JPMorgan, Bank of America

Bitcoin buys banned by JPMorgan, Bank of America

For Lloyds, that ban includes card credits for all the banks in its group, including Halifax, MBNA and Bank of Scotland, totaling more than nine million customers.

Virgin Money has announced it will also now ban the purchase of cryptocurrency with credit cards amid concerns over customers going into debt to purchase highly volatile digital currencies.

The central bank reportedly said it would "tighten regulations" on Chinese people's participation in overseas cryptocurrency transactions and ICOs.

"This only applies to our credit cards and not our debit card". Bitcoin now sits at just under $8,000 and understandably, banks are anxious about its customers getting caught up in the "digital gold" craze.

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"We continually review our products and procedures and this is part of that", a Lloyds Bank spokesperson BBC.

Despite being tempted to dip their toes into the cryptocurrency market past year, many seem to be back on the defensive. Last week, ETHNews reported that Capital One "has started declining credit card transactions to purchase cryptocurrency", though the company is open to reevaluating this policy down the line.

"In areas like cryptocurrencies, like Bitcoin, we should be looking at these very seriously, precisely because of the way they can be used, particularly by criminals".

A spokesman for the Royal Bank of Scotland said: "We constantly review transactions but do now accept credit card transactions for cryptocurrencies". The coin's troubles have deepened on Monday, with its price falling below $8,000 for the second time in four days.

Over in the U.S., major banks are making similar moves.

So, in a move aimed to reduce both legal and financial risk, most major banks have banned the use of their credit cards to purchase Bitcoin or other cryptocurrencies.

Cutting off card purchases could exacerbate those pressures by making it more hard for enthusiasts to buy into the market.

Barclays, Nationwide, Tesco and TSB have no plans to implement their own bans - although some banks noted they will keep an eye on cryptocurrency borrowing. We will have to wait to see if, such bans will be lifted once the market correction subsides.

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