UK Banks Continue to Block Bitcoin Transactions, Policy Group Reports to Parliament

UK Banks Still Restricting Bitcoin Transactions

A UK policy group has told Parliament that British banks are still blocking or delaying transactions related to Bitcoin. Bitcoin Policy UK, an organization focused on Bitcoin regulation, submitted evidence to a parliamentary inquiry showing that 40% of bank transfers to cryptocurrency exchanges are currently blocked or delayed.

The group says this problem has not improved in the last three years, despite government statements that banks should assess each case individually rather than applying blanket restrictions.

Bitcoin is a digital currency that allows people to send money directly to each other without a bank. A cryptocurrency exchange is an online service where people can buy, sell, or trade Bitcoin and other digital currencies.

Key Findings from the Report

• 40% of bank transfers to cryptocurrency exchanges in the UK are blocked or delayed.
• No improvement in banking restrictions for Bitcoin transactions in the past three years.
• Some banks block Bitcoin-related transactions outright, while others limit transfers to £2,500 per transaction.
• 80% of cryptocurrency exchanges report that restrictions have increased over the past year.
• Half of UK fintech and crypto firms have been refused a bank account or had one closed.

Which Banks Are Restricting Bitcoin Transactions?

According to Bitcoin Policy UK, several major UK banks are applying restrictions on Bitcoin-related transactions:

• Virgin Money, Metro Bank, Starling Bank, TSB, and Chase UK block transfers and card payments to cryptocurrency exchanges outright.
• Barclays and HSBC limit transfers to £2,500 (about $3,400) per transaction.

The group says these restrictions affect lawful Bitcoin activity and that banks are treating all cryptocurrencies the same, even though Bitcoin is different from other digital assets like stablecoins (which are tied to traditional currencies like the US dollar).

What Bitcoin Policy UK Is Asking For

The organization has made four requests to improve the situation:

1. A clear statement from regulators that Bitcoin transactions through a registered exchange should not face blanket restrictions.
2. A requirement for banks to give specific reasons when they block a transaction and provide a way for customers to appeal.
3. Confirmation that registration with the Financial Conduct Authority (FCA) can be used as a basis for assessing risk, similar to rules in Hong Kong.
4. A published report that regularly measures how often transactions are restricted.

What Is Confirmed

• Bitcoin Policy UK submitted evidence to a UK parliamentary inquiry on August 23, 2026.
• The group reports that 40% of bank transfers to cryptocurrency exchanges are blocked or delayed.
• Several major UK banks are applying restrictions on Bitcoin-related transactions.
• No improvement in banking restrictions has been observed in the past three years.
• A 2025 survey found that half of UK fintech and crypto firms had been refused a bank account or had one closed.

What Is Still Unclear

• Whether the UK government will take action based on Bitcoin Policy UK’s evidence.
• How individual banks justify their restrictions on Bitcoin transactions.
• Whether other cryptocurrencies face the same level of restrictions as Bitcoin.

Why This Matters for Bitcoin Users in the UK

These restrictions make it harder for people in the UK to buy, sell, or use Bitcoin. When banks block or delay transactions, it can prevent users from accessing their money or trading at the right time. The restrictions also affect businesses that work with Bitcoin, making it difficult for them to operate.

The UK government has previously said it wants to become a global hub for cryptocurrency. However, Bitcoin Policy UK argues that these banking restrictions are making it harder for the UK to compete with other countries.

Sources

• Bitcoin Magazine