A cross-party group of UK Members of Parliament and peers has launched a parliamentary inquiry into the banking challenges faced by crypto and digital asset businesses. The initiative aims to investigate the barriers firms encounter when opening accounts and the restrictions on crypto-related payments imposed by major banks.
Sector-wide banking challenges
The Crypto and Digital Assets All-Party Parliamentary Group (APPG), co-chaired by Lord Vaizey of Didcot and Labour MP Gurinder Singh Josan, is leading the inquiry just weeks after the implementation of the UK’s new regulatory framework for crypto assets. The group intends to determine whether ongoing banking issues could hinder the Government’s ambition to position the UK as a global leader in digital assets.
APPGs in the UK Parliament are informal, cross-party groups that address specific topics of interest. The Crypto and Digital Assets APPG is the main parliamentary group focusing on matters related to the cryptocurrency and digital asset sector.
For several years, UK crypto businesses have reported difficulties with opening or maintaining bank accounts. Leading banks, including HSBC, Nationwide, NatWest, Santander, and Starling Bank, have imposed various restrictions on transactions involving cryptocurrencies. The inquiry will assess access to essential banking services, such as insurance, alongside the effect of transfer limits and payment blocks placed on crypto-related activities. The group aims to evaluate whether these measures are appropriate and analyze their effects on consumers, competition, and innovation.
Access to banking services is fundamental for any legitimate business, and where unnecessary barriers exist they have the potential to hinder growth, investment, and innovation. It is the right time to examine whether remaining barriers could undermine the UK’s ambitions of becoming a global leader in digital assets, ahead of the new crypto framework coming into force.
Research highlights impact on the industry
Research published by the UK Cryptoasset Business Council in January revealed that UK banks were blocking or delaying approximately 40% of transfers to crypto exchanges. The same data shows that 70% of crypto exchanges surveyed found that banking restrictions were negatively impacting investment, expansion, or hiring in the country.
A prior inquiry by the APPG in 2023 described similar problems, warning the government that these frictions put the UK’s digital asset hub aspirations at risk and called for urgent action.
| Issue | Impact (%) |
|---|---|
| Transfers blocked or delayed | 40% |
| Exchanges reporting business disruption | 70% |
Official responses and prospects
HM Treasury has acknowledged concerns about banking restrictions. Economic Secretary Lucy Rigby recently affirmed that regulated crypto firms “should not” face service bans solely based on their sector. Under the new UK regime, the government does not expect FCA-licensed companies to be denied banking services due to their involvement with crypto assets.
Under the new regulations, FCA-approved crypto businesses are not expected to be refused access to banking services purely because of their business type, according to the government’s latest position.
The APPG will also study how other key regions—including the United States, Hong Kong, Australia, and the European Union—address banking for crypto firms. Issues around “debanking” have surfaced internationally as well. In the US, companies have alleged that an unofficial campaign, nicknamed “Operation Chokepoint 2.0,” pressured banks to cut ties with crypto firms. Meanwhile, in Australia, Coinbase has accused banks of launching an “unlawful” regulatory ban on crypto access.
The group is accepting written evidence until August 31 and intends to publish recommendations well before the new UK crypto regime becomes mandatory in October 2027.
Mini dictionary: Crypto and Digital Assets APPG – The All-Party Parliamentary Group focused on cryptocurrency and digital assets, composed of UK MPs and peers from multiple political parties and serving as a forum to discuss and recommend policy on digital assets and blockchain technology.
Recent developments in US crypto banking
In related developments, Payward, the parent company of the US-based crypto exchange Kraken, secured a $22 million arbitration award against its former auditor Mazars USA. Kraken stated that Mazars ended its auditing work prematurely, reportedly causing reputational damage during a period when US authorities were accused of pressuring banks to cut off crypto companies—an episode widely referred to within the sector as Operation Chokepoint 2.0.
The APPG plans to analyze global approaches to banking for digital asset firms as it evaluates recommendations for UK policy and industry standards.
