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Report: Lloyds Banking Group blocks bitcoin purchase with credit cards

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Report: Lloyds Banking Group blocks bitcoin purchase with credit cards

Lloyds Banking Group Plc halted its credit card users from buying bitcoin in the wake of the digital currency's prices falling, The Daily Telegraph reported Feb. 5, citing a spokesman.

The bank's concern is that customers are using credit cards to buy bitcoin in the hope of making a profit when its value goes up, but risk being unable to repay their debt when its value goes down, as it has in recent days. The bank also has concerns that the currency is being used for drug dealing and money laundering, the report noted.

The first U.K. bank to do so, Lloyds will reportedly block attempts for online buying of the cryptocurrency though a blacklist, which will flag up sellers. Customers can still make purchases with debit cards.

Virgin Money Holdings (UK) Plc followed Lloyds in imposing a ban on bitcoin purchases by credit card, Reuters reported Feb. 5, adding that Barclays Plc and Banco Bilbao Vizcaya Argentaria SA said they had no plans to take similar actions. Citigroup Inc. and JPMorgan Chase & Co. have similar bans in the U.S., the newswire noted.