Thursday, January 25, 2018

Banks Begin Restricting Customers’ Purchases of Bitcoin


This month, Capital One Financial Corp.decided it would no longer let its customers use credit cards it issues when buying bitcoin or other cryptocurrencies such as Ethereum “due to the limited mainstream acceptance and the elevated risks of fraud, loss and volatility.” The bank said it would “regularly evaluate the decision as cryptocurrency markets evolve,” reports The Wall Street Journal.

Bank of America Corp. allows bitcoin purchases with the credit cards it issues. “At this point there is nothing that would block a transaction, but we are carefully reviewing our policy,” said a bank spokeswoman.

Citigroup Inc. which allows bitcoin purchases with its credit cards, is also reviewing its policy, according to a person familiar with the matter. TD Bank, the U.S. unit of Toronto-Dominion Bank ,  said that as a result of security measures some bitcoin transactions aren’t being processed.

According to WSJ, with bitcoin, some 18% of buyers funded their purchases with a credit card, according to a survey released in December from lending marketplace LendEDU. Of those, 22% said they didn’t pay off their credit-card balance after the purchase. Nearly 90% of that group expected to eventually pay off their balance using profits from the investment, the survey found.

  -RW

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