Sunday, June 16, 2019

Another U.S. Bank Blocks Customers from Buying Bitcoin

If you hold an account in Regions Financial Corporation, the good news is you can still deposit and withdraw money. The bad news is, you may no longer be able to buy Bitcoin using the same cash held in your account. The latter is as a result of a 2018’s Bank Deposit Agreement which will affect how holders of accounts with the Alabama-based bank interact with digital currencies.

Lawyer Reveals Block on Crypto Transactions

According to Stephen Pally’s tweet on March 29, the “2018’s Regions Bank Deposit Agreement” has some terms that will affect the way customers’ use their account to buy cryptocurrencies. A screenshot of the document reveals that the bank reserves the sole right and discretion to either return or decline payments made for assets that are backed by the blockchain.

As a result, payments made for decentralized assets also known as cryptocurrencies, non-fiat virtual currencies, digital currencies, etc. will be affected. The account holder also agrees that the bank shall not be liable for their payments being returned or declined.

Community Makes Comments About Blockage

While the tweet may have been made to reveal the bank’s latest development, it did not go unnoticed by the cryptocurrency community. For instance, Anthony Pompliano, co-founder of Morgan Creek Digital said:

Nicholas Weaver, a senior researcher at the International Computer Science Institute at Berkeley who recently stated that Bitcoin is Bovine excrement and needs to be burnt also commented on the tweet. According to him:

More Banks in the U.S. Block Crypto Transactions

These aside, Regions Financial Corporation is not the first bank in the U.S. to block crypto transactions. Others that have taken the same route include Bank of America, Citigroup, Discover, and Capital One. The same can be said about JP Morgan, a financial institution that now intends to launch its own cryptocurrency to enable its customers’ carry out transactions.

In the case of Bank of America, a Redditor about a year ago claimed that the bank blocked him/her from buying cryptocurrency using their credit and debit card. This was evident from the inability for transactions on Coinbase, Bitstamp, and Abra to be processed using either of these cards. After contacting the bank to find out why that was so, they were told that other currencies were not allowed to be bought.

Asides from the U.S., several banks in India have also taken steps to discourage people from buying cryptocurrencies. The country’s Reserve Bank warned banks in the area of the risks associated with dealing with the cryptocurrency community. Banks, on the other hand, began to send emails to some traders that their account has been blocked after noticing a cryptocurrency transaction.

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