Barclays Prohibits Cryptocurrency Purchases with Credit Cards
In a significant development in the financial sector, Barclays has announced its decision to prohibit customers from buying cryptocurrencies using their credit cards, effective June 27, 2025. This move is part of a broader trend among UK banks to tighten restrictions on crypto transactions, particularly in light of rising concerns about the associated risks.
Concerns Over Financial Risks
According to Barclays’ statement released on the bank’s Barclaycard website, the institution acknowledges that crypto purchases present substantial risks, especially given the volatility associated with digital currencies. Barclays expressed specific concerns that fluctuations in cryptocurrency values could potentially lead customers into financial distress, emphasizing that such digital assets do not fall under the protective umbrella of current banking regulations.
This decision aligns with recent initiatives from the UK’s Financial Conduct Authority (FCA), which is advocating for a comprehensive ban on using credit to buy cryptocurrencies. The FCA articulated its worries in a discussion paper, noting that individuals who buy crypto assets with credit might incur unsustainable debt, particularly if the value of those assets declines.
Trends in Cryptocurrency Investment
Notably, a YouGov survey cited by the FCA highlighted that the percentage of UK cryptocurrency investors utilizing credit cards or credit products for their purchases rose from 6% in August 2022 to 14% by August 2024. Barclays’ restriction follows similar limitations imposed by other major UK banks, including Chase UK, HSBC, and Nationwide. Nationwide notably implemented a cap, allowing debit card transactions for crypto to just £5,000, around $6,860, while Chase UK has taken a more comprehensive approach by banning all transactions to cryptocurrency exchanges from their platform.
Expert Opinions on Banking Restrictions
This trend towards limiting access to cryptocurrencies has provoked opinions among crypto experts. Glen Goodman, a notable analyst and author, expressed mixed feelings about the banks’ restrictions. While he understands why Barclays might opt out of financing crypto transactions, he argues against the notion of banks stopping customers from using their own funds for trading. Goodman is particularly critical of banks like Barclays and Lloyds that have halted transfers to Binance for several years, stating that preventing customers from moving their own money to trading accounts is an overreach.
Meanwhile, other banks like TSB and Santander have already imposed bans on all crypto-related purchases since the early 2020s.
Cautions for Cryptocurrency Traders
Amid these developments, Goodman does caution traders against employing borrowed funds for cryptocurrency investments, noting the inherent risks involved. He acknowledges that while experienced traders in the crypto and stock markets sometimes leverage debt, it requires significant skill to manage associated risks effectively. As such, while granular banking regulations may attempt to shield consumers from potential losses, they also raise questions about access to financial innovation and personal freedom in managing investments.
