Barclays Bans Crypto Transactions on Credit Cards Citing Risks

Barclays has become the latest UK bank to impose restrictions on cryptocurrency transactions, joining a growing list of financial institutions that have taken similar measures. Effective from June 27, 2025, Barclays will block all crypto transactions made with its credit cards. The bank cited the inherent risks associated with purchasing cryptocurrencies, including the potential for customers to incur debt if the value of their digital assets declines. Additionally, Barclays noted that digital assets are not covered by existing banking and financial protections, further justifying their decision to restrict such transactions.

This move by Barclays comes in the wake of increasing scrutiny from the UK’s financial regulator, the Financial Conduct Authority (FCA). The FCA has expressed concerns that consumers buying crypto assets with credit may take on unsustainable debt, particularly if the value of their crypto assets drops. The FCA’s discussion paper highlighted that 14% of UK-based cryptocurrency investors had used some kind of credit card or credit facility to purchase crypto as of August 2024, up from 6% in August 2022. This trend has raised alarms about the potential financial risks for consumers who engage in crypto transactions using credit.

Barclays’ decision follows similar actions taken by other major UK banks in 2023. Chase UK, HSBC, and Nationwide have all implemented restrictions on cryptocurrency purchases. Nationwide, for instance, set a £5,000 spending limit on crypto payments using debit cards, which are directly linked to a customer’s checking account. Chase UK went a step further by preventing its customers from making any kind of transaction to cryptocurrency exchanges and services, whether from a credit or debit card. This comprehensive ban has sparked debate among cryptocurrency experts, with some arguing that it infringes on individuals' rights to spend their own money as they see fit.

Analyst and author Glen Goodman expressed sympathy for banks managing their own risk but criticized the broader restrictions on crypto transactions. He noted that while it is understandable for banks to be cautious about lending money for crypto purchases, it is problematic when they prevent customers from transferring their own funds to crypto trading accounts. Goodman cautioned that while experienced traders may borrow money to trade, it requires skill to manage the associated risks, and many traders end up in financial trouble when they misjudge the market.

Despite the restrictions, some UK banks have been blocking transfers to certain cryptocurrency exchanges for several years. For example, Barclays and Lloyds have prevented transfers to Binance, while TSB and Santander have banned all crypto purchases since 2021 and 2022, respectively. These actions highlight the ongoing tension between financial institutions and the cryptocurrency industry, with banks prioritizing risk management over customer freedom in crypto transactions.