This week’s breaking news involves the ban on using credit cards to buy cryptocurrency (CCs) by several banks in the UK and the US. The stated justifications, such as attempting to stop money laundering, gambling, and protecting the retail investor from excessive risk, are implausible. It’s curious that banks will permit debit card purchases, indicating that the only risks being covered are their own.

With a credit card, you can gamble at a casino, buy anything you want—including guns, drugs, alcohol, and pornographic material—but some banks and credit card companies want to stop you from using their services to buy cryptocurrencies? There must be some valid justifications, and they are not the ones given.

Banks are concerned about the difficulty of seizing CC holdings in the event of a credit card holder defaulting on payments. Possession of a house or vehicle again would be much more challenging. Private keys from a crypto wallet can be easily exported from the country on a memory stick or a piece of paper with little to no evidence of their whereabouts. There may be a high value in some cryptocurrency wallets, and the credit card debt may never be repaid, resulting in a bankruptcy filing and a sizable loss for the bank. The private keys can later be accessed by the owner, who can then use a local CC Exchange in another country to convert and withdraw the funds while the crypto currency is still present in the wallet. A very sinister situation.

Although the banks are aware of the possibility and some of them want to shut it down, we categorically do not support this type of illegal behavior. With debit cards, this is impossible because the money always leaves your account right away and only if there is enough money in it to begin with. As a result, the banks are never out of pocket. We find the bank’s claims about limiting risk-taking and gambling to be largely untrue. It’s interesting that Canadian banks are avoiding boarding this train, perhaps realizing that the justifications offered for doing so are false. The result of these actions is that investors and consumers are now aware that banks and credit card companies really do have the power to impose restrictions on what you can buy using their credit card. The majority of users are probably surprised by this because they are used to making their own purchasing decisions, especially when it comes to CC Exchanges and the other retailers who have Merchant Agreements with these banks. This is not how they advertise their cards. The Exchanges and you haven’t done anything wrong, but the banking sector’s fear and greed are leading to strange events. This further demonstrates how much the banking sector perceives a threat from cryptocurrencies.

The worlds of CC and fiat money currently have little in common in terms of cooperation, trust, or understanding. The CC world lacks a central controlling body that would allow regulations to be applied globally, leaving each nation to decide for itself what to do. While Singapore and Japan have decided to embrace CCs, China has decided to outlaw them. Many other nations are still unsure of their positions. They all share the desire to recoup taxes on profits from CC investments. The unrestricted proliferation and distribution of unlicensed music made possible by the internet is not all that dissimilar from the early days of digital music. The music industry (artists, producers, record labels) were happy with reasonable licensing fees instead of nothing, and listeners were as well. As a result, digital music licensing schemes were eventually created and accepted. Future fiat and digital currencies: are there any compromises possible? There is hope that consumers will be treated with respect and not be burdened with high costs and unjustified restrictions forever as people around the world grow more and more fed up with outrageous bank profits and bank overreach into their lives.

Blockchain and cryptocurrency technologies put more pressure on nations to reach a fair compromise; this is a game-changer.

Stay tuned!