Barclays (BARC), one of the U.K.’s largest banks, said it will stop customers using their credit cards to purchase cryptocurrency by the end of the week.
The London-based company will block cryptocurrency transactions on its Barclaycard-branded payment cards starting June 27, it said on a website page published Wednesday. The page cited “certain risks” when purchasing crypto.
“We’re doing this because a fall in the price of crypto assets could lead to customers finding themselves in debt they can’t afford to repay,” the page reads. “There’s also no protection for crypto assets if something goes wrong with a purchase, as they’re not covered by the Financial Ombudsman Service and Financial Services Compensation Scheme.”
The FSCS reimburses up to 85,000 pounds ($116,000) to customers who lose money if an institution covered by the program fails.
While banks preventing customers using their credit cards to purchase crypto is nothing new, it is unclear why Barclays has put this restriction in place now. Rival institutions Nationwide and HSBC did something similar back in March 2023 at a time when wounds from the collapse of multiple crypto firms in 2022 were still fresh.
The bank did not provide further comment on this matter when contacted by CoinDesk.
CORRECT (June 25, 16:37 UTC): Correct acronym for Financial Services Compensation Scheme in fourth paragraph.