JPMorgan's (JPM) UK Retail Bank Chase Restricts Crypto Dealings
Because of increased scams and fraud cases, JPMorgan’s JPM retail bank, Chase, in the U.K. has decided to restrict customers’ access to cryptocurrency-related transactions. The bank said that from Oct 16, there will be a limit on the ability of its customers to engage in crypto transactions in the U.K.
A JPMorgan spokesperson stated, “We've seen an increase in the number of crypto scams targeting UK consumers, so we have taken the decision to prevent the purchase of crypto assets on a Chase debit card or by transferring money to a crypto site from a Chase account.”
Notably, JPM entered the U.K. market with the launch of its digital-only consumer bank under the Chase brand in September 2021. Since then, it has attracted more than 1.6 million customers. The company holds more than £10 billion in customer deposits in the country and has processed more than 90 million card and payment transactions.
Until July 2020, the Office of the Comptroller of the Currency did not grant permission to banks in the United States to hold cryptocurrencies. The amendment post-July gave banks the go-ahead to begin exploring cryptocurrency operations.
While more banks and financial institutions started embracing cryptocurrencies after witnessing increased demand for the emerging market, crypto assets like Bitcoin and Ethereum remain largely unregulated in the U.K., which is worrisome.
Chase is not the first bank to block or restrict crypto transactions. Earlier this year, banks like NatWest Group plc NWG and Banco Santander SAN imposed tighter restrictions on U.K. customers looking to use crypto.
In order to protect its customers from crypto-related scams, NatWest imposed new limits on the daily and monthly amount consumers can send to crypto exchanges. Now, NWG customers can only send a maximum of £1,000 per day and £5,000 over a 30-day period to crypto exchanges.
Similarly, Spain’s Santander said that it would block U.K. customers from sending real-time payments to crypto exchanges. While SAN prohibits payments from a customer’s account to Binance, customers can transfer funds to their accounts from Binance.
A Little on JPMorgan’s Crypto Exposure
While JPM’s CEO, Jamie Dimon, has shown his disinterest in cryptos, the bank has been among the leaders in experimenting with blockchain and the metaverse technology.
In July 2021, JPM became the first major bank in the United States to allow its financial advisors to give all its wealth management clients access to cryptocurrency funds. JPMorgan has also been offering its Private Bank wealth management customers access to an in-house passively managed Bitcoin fund.
The Wall Street giant launched a division focused on digital assets named Onyx and its own digital currency, JPM Coin. JPM Coin was launched in 2019 to allow corporate clients to move euros and dollars internally.
Moreover, JPM is in the early stages of exploring the concept of launching a blockchain-based deposit token for customers, provided it receives regulatory approval. If approved, JPM might launch it in less than a year.
Over the past six months, shares of JPM have gained 12.5% compared with the industry’s growth of 3.2%.
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Currently, JPMorgan carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report
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