UK Crypto Rules Won't Force Banks to Lift Exchange Payment Restrictions

The UK's new crypto regulatory framework will bring digital asset businesses under a broader Financial Conduct Authority regime, but banks may still restrict customer payments to cryptocurrency exchanges.

The FCA published final perimeter guidance on September 16 explaining which crypto activities require authorisation. Covered activities include operating crypto trading platforms and issuing qualifying stablecoins. However, the framework regulates crypto businesses themselves and does not force banks to process payments to FCA-authorised exchanges.

Banks can impose their own restrictions even after crypto firms become fully authorised under the new regime. For example, Chase UK blocks any outgoing payment identified as a crypto transaction, including bank transfers and card payments to crypto exchanges. NatWest limits identified crypto-exchange payments to £1,000 per day and £5,000 over any 30-day period.