Barclays Bans Crypto Transactions on Cards from June 2025

Barclays, a prominent British banking institution, has announced a significant policy change effective from June 27, 2025. The bank will prohibit all cryptocurrency transactions made using its credit and debit cards. This decision is driven by the perceived risks associated with cryptocurrencies, including the potential for sudden price declines that could lead customers into debt and the lack of protection for crypto assets in case of purchase issues. Barclays highlighted that cryptocurrencies are not covered by the Financial Ombudsman Service and the Financial Services Compensation Scheme, which are typically available for other financial products.

The move by Barclays is part of a broader trend in the United Kingdom, where traditional financial institutions have taken a stricter approach to cryptocurrency trading and investing. This trend reflects the growing concerns among banks regarding the volatility and risks associated with cryptocurrencies. The decision by Barclays to block crypto transactions on its credit cards is a significant development in the evolving relationship between traditional financial institutions and the cryptocurrency market. While some argue that the volatility of cryptocurrencies is not unique and that other assets also experience price fluctuations, banks remain cautious due to the lack of regulatory oversight and consumer protection mechanisms in the crypto space. This caution is further underscored by the fact that cryptocurrencies are not covered by traditional financial safeguards, leaving consumers vulnerable to potential losses.

The ban on crypto transactions by Barclays is expected to impact a significant number of its customers who use credit cards for purchasing cryptocurrencies. This move will likely force these customers to explore alternative payment methods or platforms that offer more secure self-custody solutions, such as hardware wallets. The decision also highlights the ongoing debate between traditional financial institutions and the cryptocurrency community regarding the regulation and integration of digital assets into the mainstream financial system. The lack of regulatory oversight and consumer protection mechanisms in the crypto space has led to increased scrutiny from traditional financial institutions, which are wary of the potential risks associated with cryptocurrencies.

Despite the recent ban on crypto assets, previous reports indicate that Barclays has invested hundreds of millions of dollars into IBIT, BlackRock’s Bitcoin (BTC) exchange-traded fund (ETF), which launched in January 2024 and is currently the largest BTC-based ETF by trading volume. In February, the bank disclosed to the U.S. Securities and Exchange Commission (SEC) that it holds 2,473,064 shares of IBIT, worth nearly $137 million at the time. This investment highlights the bank's strategic approach to engaging with the cryptocurrency market, even as it imposes restrictions on customer transactions. The decision to invest in IBIT while banning customer transactions reflects a nuanced stance, where the bank seeks to capitalize on the potential of cryptocurrencies while mitigating the risks for its customers.