A cross-party UK parliamentary inquiry will test whether banking barriers undermine the Government's digital asset ambitions, with evidence showing banks block 40% of transfers to crypto exchanges.
A cross-party group of UK lawmakers has launched a parliamentary inquiry into why crypto firms struggle to open bank accounts and why lenders curb crypto-related payments, testing whether the barriers undermine the Government's goal of making Britain a "global leader in digital assets."
The Crypto and Digital Assets All-Party Parliamentary Group (APPG), co-chaired by former digital economy minister Lord Vaizey of Didcot and Labour MP Gurinder Singh Josan, said the inquiry comes weeks after the UK finalised its new crypto regulatory framework. For years, UK crypto businesses have complained they cannot reliably open or keep accounts, while HSBC, Nationwide, NatWest, Santander and Starling Bank have restricted crypto-related payments, the APPG said.
The inquiry will examine access to accounts and services including insurance, along with transfer limits and payment blocks imposed by banks. It will weigh whether those measures are "proportionate" and how they affect consumers, competition and innovation.
"Access to banking services is fundamental for any legitimate business, and where unnecessary barriers exist they have the potential to hinder growth, investment and innovation," Josan and Vaizey said in a joint statement. They added it was "the right time" to examine whether remaining barriers could undermine the UK's ambitions ahead of its crypto regime coming into force.
Research published by the UK Cryptoasset Business Council in January found banks were blocking or delaying an estimated 40% of attempted transfers to crypto exchanges. Seventy percent of exchanges surveyed said the restrictions were hurting investment, expansion or hiring in the UK. The APPG's own 2023 inquiry reached similar conclusions, warning the friction risked undermining the UK's digital asset hub ambitions and calling for urgent action.
HM Treasury has since acknowledged the problem. In March, Economic Secretary Lucy Rigby told Parliament that under the new regime, the Government "would not expect" FCA-licensed crypto firms to be "subject to restrictions by banking services providers simply because of the sector they belong to."
The APPG said it would also look at how the United States, Hong Kong, Australia and the European Union have handled crypto banking access. Debanking has been a flashpoint in those markets. In the U.S., crypto firms have blamed a pressure campaign they call Operation Chokepoint 2.0 for severing banking ties, with Kraken recently winning $22 million from an auditor it said abandoned it during the episode. In Australia, Coinbase has accused banks of imposing an "unlawful" regulatory ban on crypto.
The APPG is taking written evidence for six weeks, until August 31, before publishing a report with recommendations to the Government, well ahead of October 2027 when the UK's new crypto regime becomes mandatory.
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