United Kingdom banks HSBC Holdings and Nationwide Building Society are banning cryptocurrency purchases via credit cards for retail customers. They join a growing list of banks in the country to tighten restrictions on digital assets.
A Bloomberg report on March 2 claims the step back is a response to warnings by U.K. regulators and scandals surrounding the crypto industry. Nationwide is reportedly applying daily limits of 5,000 British pounds ($5,965) on debit-card purchases of crypto assets, while credit cards will no longer be available for crypto transactions.
Customers of HSBC were barred from making crypto purchases with their credit cards last month. “This is because of the possible risk to customers,” HSBC wrote in an email seen by Bloomberg. In both cases, the banks pointed to warnings issued by the Financial Conduct Authority (FCA), about the risks related to crypto assets.
Other banks in the U.K. with restrictions on crypto services are Santander, Natwest Group and Lloyds Banking Group. Most of the restrictions target the crypto exchange Binance. HSBC banned credit card payments to Binance in August 2021, citing concerns about the exchange’s regulatory status in the country.
Authorities in the UK are cracking down on crypto companies. The FCA proposed in February a set of rules that could subject executives of crypto firms to two years in prison if they don’t meet certain conditions related to promotion. “Cryptoasset businesses marketing to UK consumers, including firms based overseas, must get ready for this regime,” said the watchdog in a statement.
The financial authority also stated that all crypto exchange providers — including crypto ATM operators — must be registered and comply with money laundering regulations.
A highly anticipated consultation paper for the U.K.’s upcoming crypto regulation was recently released. The proposals aim to establish the U.K.’s financial services sector at the forefront of crypto and avoid strict control measures that have gained traction worldwide. The document covers a wide range of topics, including algorithmic stablecoins, nonfungible tokens and initial coin offerings.
Three United States senators led by Elizabeth Warren have sent a letter to Binance CEO Changpeng “CZ” Zhao and Binance.US CEO Brian Shroder expressing concern over a number of facets of Binance’s activities and requesting information from the companies that includes their balance sheets.
Crypto skeptic Warren’s cosigners were fellow Democrat Chris Van Hollen and Republican Roger Marshall. They claimed there is evidence that the companies attempted to evade U.S. regulators, evade sanctions and facilitated the laundering of at least $10 billion, and lack transparency.
“What little information about Binance’s finances is available to the public suggests that the exchange is a hotbed of illegal financial activity,” the senators wrote, concluding:
“Your companies’ apparent attempts at evading the enforcement of anti-money laundering laws, securities laws, information reporting requirements, and other financial regulations cast serious doubt on the stability and legitimacy of Binance and its related entities, and on your commitment to your customers.”
The senators requested documents and other information. At the top of the list is “all Binance and Binance subsidiary balance sheets from 2017 to the present.” In addition, they ask for copies of Anti-Money Laundering and similar policies, documentation of the relationship between Binance and Binance.US and other information, as well as explanations of various news reports. They gave the addressees two weeks to respond.
As the letter made clear in its 59 footnotes, Binance has been the object of intense press scrutiny and a certain amount of negative speculation. CZ, a prolific tweeter, has responded to some reports personally. It was reported in February that Binance was preparing to settle outstanding regulatory and law-enforcement issues in the United States and would possibly be subject to penalties.
Decentralized storage networks are getting increasingly popular over mainstream centralized providers, such as Amazon Web Services, Google Cloud and Microsoft Azure. The primary reason for the shift is the low cost of operations and security.
Some notable decentralized storage platforms are Filecoin, Sia, BitTorrent and Storj. Among these platforms, Storj has developed a new scalable solution called Storj Next, promising more scalable decentralized solutions for Web2 and Web3 firms. With a focus on community building, the latest upgrade introduces a new economic model that enables broader participation in the Storj ecosystem.
Storj is a decentralized system for digital file storage that utilizes unused storage on computers worldwide with the help of encryption and blockchain. It breaks the uploaded data into smaller fractions and distributes it across the network so that no single company or organization can access all uploaded data.
The decentralized storage platform is introducing a new crypto-enabled perpetual storage feature, where dedicated wallet addresses for Storj accounts can unlock perpetual storage. Using Ethereum smart contract payments with the platform’s native Storj (STORJ) cryptocurrency, the feature will allow network participants to be rewarded for depositing STORJ.
The new model will accommodate the storage needs of node operators and independent satellite operators. Storj claimed its latest update would allow Web2 and Web3 businesses to reduce cloud costs without sacrificing reliability or performance.
The latest update will also enable staking, allowing node operators and community satellites to make way for passive income for network participants.
The platform adds capabilities with code, test data, and more for node operators who wish to move beyond operating nodes to operate a storage network. This would allow enterprises to operate their distributed storage networks globally without capital and energy-intensive data centers.
Storj claims its decentralized solutions are becoming increasingly popular among Web2 firms amid rising storage costs on centralized providers. In the last year, Storj has scaled from 13,000 to 20,000 nodes — a 40x rise in network use.
This Daily Dose was brought to you by Cointelegraph.