Lloyds Banking Group is now preventing customers of its credit cards from buying bitcoin; the ban applies across Lloyds Bank, Bank of Scotland, Halifax, and MBNA. The change will affect the banking group’s eight million credit card customers, but those with debit cards will be unaffected. The move was made because it fears people will build up unpayable debts.
The decision follows similar actions taken by several of the biggest issuers of credit cards in the U.S.; Bank of America, Citigroup, JP Morgan, Capital One, and Discover all banned their customers from using their credit cards to buy bitcoin. The timing of the bans comes off the back of the Davos economic forum which big wigs from Lloyds Banking Ground attended.
The decision from Lloyds is definitely not being made without reasonable cause. Over the Christmas period, we watched the price of bitcoin soar to around $20,000 on the back of an entire year of quick growth. While the price of the grandfather of cryptocurrency is well above its position at the start of 2017, it has dropped significantly from $20,000 to a current (as of writing) price of $7,601.
The quick ascension of bitcoin has gained it attention from the wider public, some of whom are considering it like a sort of stock they can invest in to make money back down the line. It has also drawn the eye of regulators who are now either looking to outright ban the currency or simply slap a tax on it.
Source: BBC News