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- 1 Recently, JPMorgan Chase blocked crypto transactions in the U.K. due to fraud concerns.
- 2 The U.K. banks also took steps to save customer’s funds from crypto frauds.
JPMorgan Chase U.K. will ban cryptocurrency purchases from next month to combat the rising number of criminals using digital assets to target victims. The ban by Chase U.K. marks a step up as the British lenders try to stop their networks from being used for any further fraud.
Chase stated that its U.K. block, which will come into effect from October 16, 2023, had been informed with data showing the high rate of crypto fraud in the country. It also includes fake investments and false celebrity endorsements.
Crypto-linked fraud losses rose more than 40 percent in the year ending March 2023. It surpassed £300 Million for the first time. Although Chase U.K.’s move is not part of a group-wide policy, JPMorgan said in 2018 that it would prohibit customers from purchasing cryptocurrencies with credit cards.
Some Previous Crypto-linked Steps Taken by the U.K. Firms
A rising number of lenders now limit how customers can purchase digital assets. In March, NatWest, a U.K.-based retail and commercial bank, set limits on transactions to exchanges to “protect consumers [from] losing life-changing sums of money”. A month before, HSBC, a British universal bank and financial services group, also announced that customers would no longer be able to buy cryptocurrencies with their credit cards.
Cryptocurrencies including Bitcoin and Ether are largely unregulated in the country. Although the regulators are assessing how best to keep an eye on the asset class. It can be said that the ban by JPMorgan Chase U.K. is likely to have a negative impact on the crypto industry in the short term.
However, the long-term impact is less clear. It is possible that the ban will lead to a decrease in crypto frauds. This would be a positive development for the industry, as it would make it more trustworthy and appealing to investors.
Meanwhile, it is also possible that the ban will simply drive crypto activity to other platforms, such as unregulated exchanges. It could make it more difficult for regulators to oversee the crypto market and could increase the risk of fraud.
Jamie Dimon’s Thoughts for Crypto
Earlier this year, the CEO of JPMorgan, Jamie Dimon, said “Bitcoin is a hyped-up fraud and cryptocurrencies are a waste of time.” However, he said that the blockchain is a ‘deployable’ technology.
“Bitcoin itself is a hyped-up fraud,” says @jpmorgan CEO Jamie Dimon. “Crypto is a decentralized Ponzi scheme…It’s a pet rock.” pic.twitter.com/9KQfckty8f
— Squawk Box (@SquawkCNBC) January 19, 2023
During the interview, he argued that there’s a distinction between digital coins and blockchain technology. “Blockchain is a technology ledger system that we use to move information… we use it to move money. So that is a ledger that we think will be deployable.”
The CEO of JPMorgan Chase also added that he wasn’t surprised by the collapse of crypto exchange FTX into bankruptcy in November. “I called it a decentralized Ponzi scheme. The hype around this thing has been extraordinary,” he said. “Crypto itself doesn’t do anything.”
With a background in journalism, Ritika Sharma has worked with many reputed media firms focusing on general news such as politics and crime. She joined The Coin Republic as a reporter for crypto, and found a great passion for cryptocurrency, Web3, NFTs and other digital assets. She spends a lot of time researching and delving deeper into these concepts around the clock, and is a strong advocate for women in STEM.
