Altcoin News: Survey: 73% of British Cryptocurrency Companies Are Forced to Open Bank Accounts Abroad

July 23, 2019, by Marko Vidrih on ALTCOIN MAGAZINE

According to a new study, almost three-quarters of cryptocurrency companies in the UK are forced to conduct banking operations abroad due to difficulties in opening accounts in the country.

The study was conducted by CryptoUK, a self — regulatory organization whose role is to improve industry standards and interact with the political sphere. The organization, which surveyed more than 40 leading companies in the crypto active assets sector in May and June 2019, found that banks often refuse to open accounts for cryptocurrency companies, pushing these firms to search for more benevolent jurisdictions.

55% of the surveyed cryptocurrency companies operating in the UK applied for opening bank accounts domestically but were refused. In half the cases, they were not given any comments regarding the refusal. 73% of those surveyed said they had opened a bank account in another country, citing as an example more than 15 different jurisdictions, including the United States, Switzerland and several EU countries, a CryptoUK representative told Bitcoin Magazine.

In most of these countries, there are regulatory regimes for cryptocurrency companies, and their governments have made active efforts to simplify business operations in this sector.

“Many in the crypto sector, including CryptoUK’s members, want to call the U.K. home, invest in innovation and grow their operations here,” Iqbal V. Gandham, chair of CryptoUK, said in a public statement. “But as our survey shows the often-impossible task of opening a bank account is forcing more companies to turn to other jurisdictions, which are often riskier and offer less certainty to companies.”

Although the UK government seeks to preserve the country’s position as the largest fintech center after Brexit, the UK risks facing an outflow of innovations and personnel if banks continue to refuse to conduct business with cryptocurrency companies, notes CryptoUK.

The survey showed that 69% of respondents either moved or are considering leaving the UK because of difficulties opening an account, while 75% of those polled said that they needed access to banking services to expand operations in the UK.

“Banking services are crucial to enable crypto companies to thrive in the U.K., which was made clear in the responses to CryptoUK’s survey,” the spokesperson said. “Access to banking services in the U.K. would provide greater reassurance for businesses and consumers, allowing the industry to thrive in a secure environment.”

According to CryptoUK, the difficulties that cryptocurrency companies face in the banking sector are largely due to the lack of clarity in the regulation of crypto active assets, which forces banks to apply a restrictive approach to working with enterprises in this sector. CryptoUK calls on the government and regulators to pay attention to jurisdictions such as France, which this month will publish rules that support cryptocurrency companies in accessing banking services.

“The government has repeatedly declared its desire to make the U.K. the global hub of fintech, and the crypto industry plays a critical role in the sector. The crypto asset industry is currently worth over £300 billion,” the spokesperson said. “The U.K. has the opportunity to become a world leader within the crypto economy, but if we want the brightest minds and the best firms to call the U.K. home, the government must support our emerging sector through appropriate, proportionate and well-designed regulation.”

Author: Marko Vidrih