Barclays to Block Crypto Purchases via Credit Cards from Friday

United Kingdom-based bank Barclays announced it will begin blocking cryptocurrency transactions made using its Barclaycard credit cards starting Friday. The move, citing the inherent volatility of digital assets.

According to the bank’s website, the decision stems from concerns over the fluctuating prices of crypto assets and the absence of regulatory safeguards for consumers. Barclays stated:

“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. 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.”

A Barclays spokesperson declined to provide further comment.

The ban follows Barclays’ history of allowing such transactions since at least 2018, during which time the bank reported managing over five million credit card accounts in the UK.

Barclays’ restrictive action occurs amidst an ongoing regulatory discussion in the UK regarding potential further limitations on credit-based crypto purchases. On May 2, the UK’s Financial Conduct Authority (FCA) published a paper seeking stakeholder views on “whether restrictions should be applied to credit-funded acquisitions of crypto assets.”

The Payments Association, responding to the FCA’s proposal, countered that such a ban would unfairly stigmatize crypto assets by equating them with inherently risky activities. Their statement argued:

“Concerns arise regarding the proposed ban on using credit cards to purchase crypto. This suggestion seems to equate crypto purchases with gambling; instead, consumers should be empowered to make informed choices within predefined credit limits.”

The association highlighted that existing credit controls already apply to high-risk assets like crypto and that limiting cash purchases often makes credit cards the default method. Furthermore, the Payments Association noted that purchasing crypto with a credit card can incur additional costs, as some issuers treat these transactions as cash advances, triggering higher fees and interest rates.