UK Lawmakers Launch Inquiry Into Crypto Banking Access Barriers
In brief
- Cross-party UK parliamentary inquiry examines banking barriers for crypto firms
- 40% of crypto exchange transfers blocked or delayed by UK banks
- 70% of exchanges report restrictions harm UK investment and hiring
- Inquiry compares UK approach to US, EU, Australia and Hong Kong
- New UK crypto regime mandatory October 2027
Banking Barriers to Crypto Growth
UK banks including HSBC, Nationwide, NatWest, Santander and Starling Bank have restricted crypto-related payments for years. The problem isn't new. Research by the UK Cryptoasset Business Council in January found banks were blocking or delaying an estimated 40% of attempted transfers to crypto exchanges.
The impact on the sector is measurable. 70% of exchanges surveyed said the restrictions were hurting investment, expansion or hiring in the UK. This isn't the first time Parliament has flagged the issue—the APPG's own 2023 inquiry reached similar conclusions, warning the friction risked undermining the UK's digital asset sector.
Government Acknowledgment and New Framework
HM Treasury has acknowledged the problem and says regulated firms shouldn't be shut out simply for operating in crypto. In March, Economic Secretary Lucy Rigby told Parliament that under the new regime, the Government "would not expect" FCA-licensed crypto firms to face restrictions from banking services providers simply because of their sector.
The timing matters. The UK's new crypto regime becomes mandatory in October 2027, giving the regulator time to address structural barriers before enforcement kicks in. The inquiry suggests lawmakers aren't confident voluntary compliance will solve the problem.
International Comparison and Timeline
The APPG isn't operating in isolation. The inquiry will examine how the United States, Hong Kong, Australia and the European Union have handled crypto banking access. The comparison is instructive—Kraken recently won $22 million from an auditor it said abandoned it during Operation Chokepoint 2.0 in the United States, and in Australia, Coinbase has accused banks of imposing an "unlawful" regulatory ban on crypto.
The APPG is taking written evidence for six weeks, until August 31, before publishing a report with recommendations. The inquiry will test whether a new regulatory regime alone can unlock banking access, or whether deeper structural change is required.
