The co-chairs of Parliament's Crypto and Digital Assets All-Party Parliamentary Group (APPG) have written to the chief executives of every major UK bank, pressing them to explain how they treat crypto and digital asset firms and whether their stance will shift once the Financial Conduct Authority's new regulatory regime takes effect.

The letter, sent Tuesday by Labour MP Gurinder Singh Josan and Lord Vaizey of Didcot, a former digital economy minister, states that the group has heard "repeated instances where crypto and digital asset firms have struggled to open accounts with UK banks," alongside reports that several banks have restricted crypto-related payments.

"Access to banking services could be one of the single biggest barriers to growth for UK crypto and digital asset businesses, and could potentially undermine the success of the UK's forthcoming crypto regime," the co-chairs wrote. They added that limited access could influence the decisions of firms weighing whether to invest in the country.

The intervention comes as the UK competes with jurisdictions that have already implemented comprehensive crypto frameworks — the EU's Markets in Crypto-Assets regulation took full effect in December 2024, giving firms authorized in one member state passporting rights across the bloc.

The letter puts six questions to each bank: what its policy is; whether it currently serves crypto firms and, if not, why; what limits it applies to crypto-related transactions; what factors drive that approach; whether the incoming FCA regime will change it; and what the Government or regulators could do to help.

Josan and Vaizey acknowledged that banks have legal obligations to prevent financial crime and protect consumers, but noted that many firms argue decisions should reflect a company's individual risk profile rather than the sector it operates in. Lord Vaizey told the Financial Times that the difficulties amounted to "an unnecessary piece of friction" in running a business and counted among the obstacles facing anyone setting up a firm in the UK.

UK banks including HSBC, Nationwide, NatWest, Santander and Starling have curbed crypto-related payments in recent years. Research from the UK Cryptoasset Business Council in January found that banks were blocking or delaying an estimated 40% of attempted transfers to crypto exchanges.

According to the FT, banks cite a rise in crypto-related scams and the risk of retail customers losing large sums to volatile prices. The newspaper reported that HSBC, NatWest, Monzo and Nationwide cap monthly transfers to crypto exchanges at between £5,000 and £10,000, while Starling and Chase UK bar them outright. Crypto losses are not covered by the Financial Services Compensation Scheme.

Government Response

HM Treasury has already conceded the problem. Economic Secretary Lucy Rigby told Parliament in March that under the new regime the Government "would not expect" FCA-licensed firms to face restrictions from banks "simply because of the sector they belong to." The FCA's finalized rules apply to trading venues, custody providers, lending platforms, and related activities, bringing authorized firms under conduct-of-business and consumer-protection standards comparable to those governing traditional financial services.

The APPG's letter follows its inquiry into banking access, launched July 21, which is accepting written evidence until August 31 before reporting to Government. The co-chairs said the letter is not intended to pre-empt those findings. The FCA finalized its rules for the sector in June, with the regime becoming mandatory in October 2027.

Crypto debanking has also been contested in other markets. U.S. firms have blamed a pressure campaign they call Operation Chokepoint 2.0 for severing their banking ties, and Kraken won $22 million from an auditor it said abandoned it during the episode.