UK lawmakers press banks on crypto firm banking access

Members of the U.K.’s Crypto and Digital Assets All-Party Parliamentary Group have written to major banks requesting clarification on their policies regarding banking services for cryptocurrency and digital asset firms.

The cross-party group, which includes lawmakers from the House of Commons and House of Lords, cited concerns over the lack of access to traditional banking for crypto businesses as a potential barrier to innovation and regulatory compliance. In the letter, seen by Reuters, the group asked lenders to outline their risk assessment frameworks and any specific measures taken to facilitate banking for crypto firms.

The inquiry follows persistent reports of banks restricting or terminating accounts tied to digital asset companies due to perceived compliance risks, including anti-money laundering and know-your-customer requirements. Industry representatives have long argued that such restrictions hinder the growth of the sector and push firms toward less regulated financial services.

A spokesperson for the group confirmed the outreach but declined to name the banks involved. The Financial Conduct Authority (FCA) has previously highlighted the importance of banking access for crypto firms to operate within a regulated framework, though it has not mandated specific banking arrangements.

The parliamentary group’s initiative underscores broader tensions between traditional financial institutions and the rapidly evolving digital asset industry. While some banks have begun exploring partnerships with crypto firms, others maintain conservative risk appetites, citing the sector’s volatility and regulatory uncertainty as key deterrents.

The group has requested responses from the banks by the end of August, with plans to assess the replies and potentially escalate the issue if responses are deemed insufficient.