Nearly three-quarters of U.K.-based crypto businesses have been forced to bank abroad due to the difficulty in opening a bank account locally, according to a survey conducted by CryptoUK, a self-regulatory trade body representing the domestic crypto asset industry.
The organization, which carried out a survey of more than 40 leading companies in the crypto assets sector in May and June 2019, found that banks are frequently refusing to open accounts for crypto businesses, pushing these companies to look for more lenient jurisdictions.
Forced to Bank Overseas
Fifty-five percent of surveyed crypto companies active in the U.K. applied for bank accounts domestically but were rejected. In half of the cases, no reason or justification was given to them.
Seventy-three percent said that they had opened a bank account in another country, citing more than 15 different jurisdictions including the U.S., Switzerland and several EU member states, a spokesperson for CryptoUK told Bitcoin Magazine.
Most of these countries have regulatory regimes for crypto companies and their governments have made proactive efforts to welcome businesses in the 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.”
Though the U.K. government has been looking to maintain the country’s position as a top fintech hub post-Brexit, the U.K. risks facing a drain in innovation and tech talent if banks continue to refuse to do business with crypto companies, CryptoUK said.
