Breaking: HSBC Blocks All Transactions To Crypto Exchanges Commencing 24 July

2024/07/24By:

Highlight:

  • HSBC began blocking all crypto exchange payments on 24 July 2024 to combat scam losses.
  • The bank claims to protect customers, citing significant financial losses to scams in Australia.


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HSBC Blocks All Transactions to Crypto Exchanges Starting 24 July

HSBC has abruptly announced comprehensive alterations, significantly impacting individuals utilizing the bank’s services for cryptocurrency transactions, with minimal prior notice.

From today HSBC will restrict all payments to cryptocurrency exchanges when deemed necessary:

From 24 July 2024, HSBC will block payments from bank accounts and credit cards that we reasonably believe are being made to cryptocurrency exchanges, for your protection.

A statement emailed to customers on July 24 – the exact day the changes came into effect – said the move is intended to protect customers.
 
The bank advised customers seeking to fund cryptocurrency exchanges to seek alternative avenues.  Notably, the four major Australian banks – Commonwealth Bank of Australia (CBA), National Australia Bank (NAB), Westpac, and Australia and New Zealand Banking Group (ANZ) – have already implemented varying degrees of restrictions on their customers’ interactions with the crypto sector.
 
Remarkably, HSBC’s announcement explicitly states that the bank will “automatically decline all transactions directed towards cryptocurrency exchanges,” underscoring the severity of these measures.  Despite this, HSBC has yet to respond to an information request from Crypto News Australia.

Why Were the Changes Made?

The bank explained the changes have been made because of an increase in scams.  HSBC said that according to the Australian Competition and Consumer Commission (ACCC), investment scams have been responsible for the “most scam losses in Australia”, and that these are chiefly through crypto. 

 The bank referenced a cumulative loss of AUD 171 million.
However, an ACCC report from April 2024 disclosed that Australians fell victim to scams totaling AUD 2.7 billion, significantly outpacing the crypto-related losses of AUD 171 million.  Notably, the overall scam losses have declined by 13% compared to previous reports.
Yesterday, CNA reported on a University of Queensland study underscoring the importance of education in mitigating crypto scams, advocating for this approach over blanket bans.

It appears paradoxical for Australian banks to adopt such measures amidst a global trend towards crypto adoption, with institutions increasingly allocating assets to crypto-related funds.  Given the shrinking options for Australians to fund crypto exchanges, ING and St.George Bank stand out as crypto-friendly alternatives in the current landscape.

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