Bank of America, JP Morgan Chase and Citigroup each confirmed to Bloomberg that they were halting activities involving digital currency with their credit cards, although Bank of America spokeswoman Betty Riess says that consumers can still use their debit cards. Capital One and Discover have beforehand said that they won’t allow their cards to be used for cryptocurrency transactions.
Bloomberg notes that digital currencies can be a problem for bankers if customers can’t repay loans, or if stolen cards are used to buy the untraceable currency. Cryptocurrencies can also be hard for banks to monitor, which are expected to look out for signs of money laundering.
JPMorgan spokesperson Mary Jane Rogers said the bank has decided to require a restriction on crypto purchases because it doesn’t want to deal with the risks connected with it. In addition to the difficulties of maintaining an eye on purchases something they’re required to do associated with crypto-coins, there’s also always the risk of personage buying more than they can afford to pay. In addition, identification thieves could use stolen credit cards to buy cryptocurrency, and banks have little chance to get that money back.
These banks aren’t the only business institutions backing away from anything affiliated with crypto. Capital One Financial and Discover also don’t allow cryptocurrency gains with their credit cards. Discover chief David Nelms even called people using virtual coins as “crooks… trying to get money out of China or wherever.” A Coinbase staff division has also revealed in a Reddit post that major credit card networks and providers recently changed the terms of digital currency purchases. The new terms allow them to treat those buying as a cash advance, which carries additional charges and has higher interest rates.
Take your time to comment on this article.
