Not every UK bank will allow transactions between its accounts and a cryptocurrency exchange. As this is the first step in building a crypto investment, it is important to make sure that you have a current account with a crypto-friendly bank. There are a host of big name banks that are considered to be 'crypto-friendly', meaning they will allow you to deposit funds into a crypto exchange, withdraw money from the exchange account to your current account and in some cases, purchase crypto with your debit card. On this page, you can find everything you need to know to find the best crypto-friendly bank for you, plus why some banks may be unfriendly towards crypto transactions and what the future might hold for crypto-friendly banking.
What is a crypto-friendly bank?
The approach taken by UK banks to transactions with crypto exchanges has softened as crypto has grown in popularity. Many major UK institutions can now be considered ‘crypto-friendly banks’ as interactions between accounts and cryptocurrency exchanges are not automatically restricted. Even crypto-friendly banks may attach some conditions, but the basics should be covered. In the recent past, investors would have faced their bank cancelling crypto exchange transactions, freezing their card or even closing the account altogether. This is now a rare occurrence with many big banks, but the changed approach has not been universally adopted.
Some UK banks may still restrict transactions with cryptocurrency exchanges, making it harder to purchase cryptocurrency, make payments to a crypto exchange or move money from your crypto wallet to your current account. These banks are best avoided if you plan to use your account to interact with your crypto holdings.
Keep in mind that even crypto-friendly banks will not support every crypto exchange. Some exchanges that are big names abroad have not complied with FCA (Financial Conduct Authority) anti-money laundering regulations and so are unable to operate in the UK. This should not be a major issue, as our top crypto exchange platforms are usually supported by the crypto-friendly banks on this page.
Top crypto-friendly banks in the UK
Here is a list of the UK institutions that could be considered 'crypto-friendly banks'. Keep in mind that any bank's policy on cryptocurrency exchange transactions could change at short notice, so make sure to check directly with the bank if you want to make sure your transactions go through smoothly.
| Crypto-friendly bank | Details |
| Monzo | Popular 'challenger' bank Monzo is online only and has a reputation for being modern and innovative. It allows transactions with most major cryptocurrency exchanges, though it does claim that it may issue blocks from time to time if a transaction is judged to be exceeding Monzo's risk parameters. You can read more on the Monzo website. |
| Lloyds | If you are a current account holder with Lloyds, you should be able to freely transfer money to your crypto exchange account and use your debit card to buy crypto. Lloyds does not allow transactions to crypto exchanges from any of its range of credit cards, due to the risks involved in buying crypto with credit. |
| Bank of Scotland | As Bank of Scotland is a subsidiary of Lloyds Banking Group, it shares many of its crypto exchange policies with Lloyds. You should be able to use your debit card to buy crypto and your current account to transfer funds to a crypto exchange, but you will not be able to use your credit card. |
| Nationwide | Big-name building society Nationwide does not generally block crypto exchange transactions from its current accounts and allows debit card crypto purchases up to £5,000 per day. Nationwide credit card holders should be aware that they will be unable to buy crypto with their credit card. You can read more on the Nationwide website. |
| NatWest | Current account holders with NatWest are unable to transfer more than £1,000 per day to a crypto exchange and no more than £5,000 over a 30-day period. NatWest also claims it will restrict or block payments to any crypto exchange if it judges the transaction to be high risk or if it deems it to be part of a potential scam. You can read more on the NatWest website. |
| RBS (Royal Bank of Scotland) | Part of the NatWest Group, meaning RBS follows the same protocols as NatWest and has limited restrictions on transactions with crypto exchanges. You can read more on the RBS website. |
| Barclays | We have included Barclays on this list because it does allow transfers to and from some major crypto exchanges. However, you cannot use a Barclays debit or credit card to buy crypto, and Barclays has banned payments to certain exchanges during periods of high scamming activity. You can read more on the Barclays website. |
Non crypto-friendly banks in the UK
At the time of writing, the below banks do not support transactions with crypto exchanges:
- Chase
- The Co-operative Bank
- First Direct
- Metro Bank
- Halifax
- HSBC
- Santander
- Starling Bank
- TSB Bank
- Virgin Money
Can you use a crypto-friendly bank credit card with a cryptocurrency exchange?
There are credit card providers that will allow crypto transactions and exchange platforms that will accept credit card payments for cryptocurrency purchases. Not every crypto exchange will allow you to use a credit card and not every credit card provider will allow the transaction to go through. If it does, you could then face hefty transaction fees and a cash advance fee. These fees added on by the lender could eradicate any benefit of using the card in the first place. You will also need to think about your credit limit and any location restrictions imposed by your credit card provider.
The major crypto trading platforms will usually accept credit cards, including Coinbase, Kraken and eToro. You should check that your chosen platform not only accepts credit cards, but accepts the issuer you plan to use, such as American Express, Visa or Mastercard. If the crypto exchange platform charges extra fees for credit card payments, make sure to take this into account when you decide what platform to go for and what payment method to use.
Why are some banks not crypto friendly?
There is no significant regulation in the UK to protect crypto investors if something goes wrong. The FCA will not step in and your holdings will not be covered by the Financial Services Compensation Scheme (FSCS). Other types of investments come with far greater protections and scrutiny of the institutions you are investing with. As a consequence, some banks want to avoid exposing customers to such a volatile investment, especially one that is a popular tool for scammers.
What’s more, banks want to protect themselves from liability if something goes wrong. If a customer loses money to a crypto scam or a failed investment, they could try to claim the original transaction should not have been approved by the bank. How likely this is to result in someone getting their money back should depend on the extent to which their bank was genuinely at fault, but some institutions prefer to eliminate that risk altogether by restricting crypto transactions.
Even though the crypto landscape is constantly shifting and the regulatory environment is set to change in the coming years, most major financial institutions continue to urge customers to only invest in crypto if they can afford to lose everything they put in. Most major cryptocurrencies have exceptionally volatile histories that include some years of soaring growth and some years of sharp decline. If you cannot afford to see your holdings crash, crypto is unlikely to be a good investment for you. Should a bank decide that this applies to most of its customers, it would make sense for it to implement restrictions on crypto exchange transactions.
Will there be more crypto-friendly banks in the future?
The future of cryptocurrency – and therefore its relation to the UK banking mainstream – is exceptionally hard to predict. The historic volatility of most major coins makes it difficult to see crypto being fully accepted without major structural changes. However, momentum seems to be behind regulatory change, plus the popularity of crypto investments continues to grow. This could certainly lead to the banks listed on this page that are holding out against crypto transactions to fall in line with the crypto-friendly banks.
Crypto as an investment is likely to be one of the next steps in digital currency’s move into the mainstream, as we wrote about in our article ‘Can you buy a Bitcoin ETF in the UK?’.
Some commentators may even argue that we are heading towards major banks directly facilitating crypto transactions, crypto becoming a mainstream payment method and workers being paid in crypto. However, the regulatory changes that this would require may go against the interest of major banks and the Bank of England itself. One of the key features of cryptocurrencies is that they are decentralised and not subject to the policies of a country’s central bank. If crypto were to grow into a significant payment method and investment in the UK, the Bank of England could potentially lose its main tools for controlling inflation and stabilising the financial market.
How to learn more about crypto
It is important to make sure you have all of the information you need before you start buying cryptocurrency. You can learn all of the key basics of crypto in our article 'A beginner’s guide to investing in bitcoin and cryptocurrency'. We also go into depth on crypto wallets and how to mine cryptocurrency in 'What is a cryptocurrency wallet?' and 'Cryptocurrency mining: What it is, how it works and how to mine bitcoin', and give a step-by-step guide on how to buy bitcoin in 'How to buy bitcoin in the UK step-by-step: A guide to buying quickly and safely'.
Keep in mind that cryptoassets are a highly volatile investment option. Investing in cryptoassets is suited only to those investors who understand these risks and are prepared to lose all the money they invest.
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