As the markets continue to look bearish with a slight sprinkling of upticks, other factors seem to be jumping into the picture. As of late, China is seeking to further clamp down on the trade of digital assets by their citizens as they are now setting up firewalls so that their citizens will not be able to access domestic or foreign digital asset exchanges. The second factor is that banks in countries like India and other nations are seeking to prevent crypto trading through credit cards. A recent bank that has expressed concerns and has made a move in this regard is an institution located in the United Kingdom, Lloyds Bank. The institution is following the coattails of other financiers and is blocking the purchase of cryptocurrencies through the use of credit cards.
The minimization of traditional credit from the markets
The banking group will be notifying their customer base of the current changes and will be setting up firewalls to prevent purchases of digital assets with credit.
Users of debit will find that they are not constricted, but of course, why would they be? Debit is their money at the end of the day.
Be advised that the banking group is comprised of significant players like Halifax, MBNA and the Bank of Scotland, in addition to Lloyds and this implementation will affect consumers across the board at these institutions.
This is along the lines of a recent communication sent by the cryptocurrency exchange, Coinbase. The trading firm sent out an email updating its users of change happening in the sector related to credit cards. The trading platform had several reasons to send out the email, but one of the most prominent may be that they want to let their customers know that they are not the ones who are charging more fees. The email notified users of the changes made by financial institutions.
“Recently, the MCC code for digital currency purchases was changed by a number of the major credit card networks. The new code will allow banks and card issuers to charge additional “cash advance” fees. These fees are not charged or collected by Coinbase. These additional fees will show up as a separate line item on your card statement.”
The reasoning of the credit card firms and banks
These firms seem to be echoing lines that the People’s Bank of China and other federal reserves across the world, is saying, such as minimizing financial risks, protecting the consumer from financial harm and more. They profess to save their customers from further debt, debt that they may have to take on if the crypto markets don’t do as well people would hope.
Will organizations like SALT and Ethlend be able to capitalize on the lack of traditional lending and be able to see an uptick in the use of their platforms?
State of the markets
The markets have been in a sea of red and a significant correction period is taking place in cryptoland as the leading cryptocurrencies take actions to live up to their market capitalizations and prove their value over the course of this year. The price of Bitcoin was trading at a rate of $7,425 a large dip from 17,000. The price of Ethereum has gone down to $725. NEO is almost cut in half, trading at a high of $167 on the 29th of January and currently trading at $87.00.
About Lloyds Bank
Since its foundation on 3 June 1765, Lloyds Bank has been serving the households, businesses, and communities of Britain. And, in 2015 we’re celebrating 250 years of helping the people of Britain with the things that matter most to them.
We offer a comprehensive range of financial products and services – including current accounts, savings, mortgages, loans and credit cards.
The origins of Lloyds Bank stretch back to 1765, when John Taylor and Sampson Lloyd set up a private banking business in Birmingham.
Lloyds Bank is a part of the larger Lloyd’s Banking group. A financial services group focused on retail and commercial customers – with millions of customers in the UK, and a presence in nearly every community.
Our role is to help businesses and individuals while making a positive contribution to the communities in which we operate.