In recent months, cryptocurrency has reached new levels of acceptance by both the general public and the wider business world. Companies like Tesla and WeWork now accept Bitcoin as a form of payment for products and services, and Time Magazine now accepts cryptocurrencies for subscription payments.
However, it appears that such businesses may not be welcome at NatWest. This is because the bank recently announced that it will not offer services to companies that accept cryptocurrency as a form of payment. The bank now also classifies cryptocurrencies as "high risk" investments.
Take a "cautious approach" with cryptocurrencies
This information from the British bank was made public by Morten Friis, a NatWest board member and head of its risk committee, who explained that the bank is trying to take a cautious approach with cryptocurrencies.
Despite this, there are plans to monitor any public statements or actions taken by the UK financial regulator. The regulator previously advised the public against investing in assets such as cryptocurrencies, saying there is a risk that investors will lose all their money.
In light of the recent development, the bank will not offer services to companies that deal closely with cryptocurrencies.
“We don't feel like dealing with clients, whether we hire them as new clients or have an ongoing relationship with people, whose core business is backed by a cryptocurrency exchange, or who transact cryptocurrencies as their core business,” he said. called Friis.
A position opposite to that of many other companies
This move is interesting considering much of the corporate world is moving to be friendlier with the cryptocurrency space instead of avoiding it. The number of companies that are starting to accept cryptocurrency as a form of payment is likely to trigger a ripple effect. This essentially means that banks like NatWest who are pushing crypto-backed companies away could lose significant profits in the future.
At the same time, this decision appears to be informed by the attitude the UK financial regulator has towards cryptocurrency. If regulators accept cryptocurrency more, this stance may change in the future.
“We expect to continue to take a precautionary approach, but we will observe how the market evolves,” noted Friis.
Hopefully, regulators' attitudes in the UK towards cryptocurrency will improve and banks like NatWest will be able to fully embrace cryptocurrency.
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