Are Bitcoin good times over or is it just market correction? Well, banks especially in the United States seem to be taking the fall in price of the currency seriously. Some of the big banks like JPMorgan Chase & Co., Citigroup Inc. And Bank of America Corp. have stated that they are stopping the buying of cryptocurrency using their credit cards. This move was already enacted by JPMorgan on Saturday stating that they were reducing credit risk.
On Friday Bank of America also started declining credit card transactions for specific exchanges. According to the bank the new directive applies to all personal and business credit cards. However, according to Betty Riess the directive does not affect debit cards.
The other major bank which is the Citigroup stated that it would also stop buying of cryptocurrencies using its credit cards. According to the company’s spokesperson Jennifer Bombardier: “We will continue reviewing our policies as this market continues to evolve.
This just came barely a month after a report indicated that most of the people in the US use credit cards to buy digital currencies. Financial institutions can have a lot of problems if these bets on cryptocurrencies go wrong and people are unable to pay. The use of credit cards is also an avenue for criminals as they can turn them in to crypto hoards.
This January has seen Bitcoin struggle amid regulatory threats all over the world. Bitcoin has already lost more than half of its value and it’s currently trading slightly above $8,000. “We will continue reviewing our policies as this market continues to evolve.
The ban on Credit cards could hit the digital currency even harder as the buying of Bitcoin and other digital currencies could become hard. The big banks in the US followed a similar move by Capital One Financial Corp. and Discover Financial Services who had previously stated that they would not support the use of Credit cards in cryptos.