A cross-party parliamentary group launched a formal inquiry on July 21 into UK banks blocking nearly 40% of crypto payments, with one exchange alone reporting close to £1 billion in rejected transactions during 2025.
The numbers are hard to argue with. Research published by the UK Cryptoasset Business Council found that roughly 40% of domestic payments to crypto exchanges are either blocked or delayed by British banks. One platform reported nearly £1 billion in rejected transactions over the course of 2025. Every single exchange surveyed said banks offer no explanation when payments are declined. Now Parliament has decided it wants answers.
The Crypto and Digital Assets All-Party Parliamentary Group, co-chaired by Lord Vaizey of Didcot and Labour MP Gurinder Singh Josan CBE, opened a six-week call for evidence on July 21, 2026, running until August 31. It wants submissions from banks, payment providers, crypto exchanges, fintechs, regulators, and academics. Simple enough in scope. The core question is whether UK banks are applying payment restrictions proportionately, and if not, what is driving the blanket approach.
What the banks are actually doing
The UKCBC's January 2026 report, titled "Locked Out: Debanking the UK's Digital Asset Economy," lays out the problem in detail. The list of names is familiar. Chase UK says it blocks any payment it identifies as a cryptoasset transaction. HSBC publishes crypto payment limits of £2,500 per transaction and £10,000 over a rolling 30-day period. Starling Bank, TSB, Metro Bank, and Virgin Money have also been named in reporting on the UKCBC findings as imposing outright blocks or restrictions on crypto-related transfers. Eight out of ten of the major exchanges surveyed said disruptions have risen over the past year, and 70% said the restrictions are reducing their willingness to invest or scale in the UK, or hire here at all. These aren't fringe operators being squeezed out. Many are FCA-registered platforms. The blocks are happening anyway.
Banks have a structural incentive here that has nothing to do with ideology. Since October 7, 2024, payment firms sending and receiving Faster Payments have had to split reimbursement for in-scope authorised push payment fraud claims, with the Payment Systems Regulator setting the cap at £85,000 per claim. That liability pressure is real. But the UKCBC argues the response is disproportionate: blanket blocks rather than case-by-case assessment, which it says may violate the Payment Services Regulations 2017 and FCA Consumer Duty rules, and could fall foul of the Competition Act 1998.
How the UK compares, and why it matters
The APPG will also look at how other jurisdictions handle this, specifically the US, Hong Kong, Australia, and the EU. That comparison matters. The UK doesn't operate in isolation here. Rivals in those markets work in a considerably friendlier environment.
American crypto firms fought their own version of this under the informal label "Operation Chokepoint 2.0," which described what critics said was coordinated regulatory pressure from Biden-era agencies on banks to exit crypto relationships. The US situation has since shifted. The Federal Reserve proposed in February 2026 to codify the removal of "reputation risk" from its supervision of banks, and US banking agencies later removed additional references to reputation risk from interagency documents. The UK situation differs structurally. There's no documented government coordination here. British banks appear to be acting unilaterally, driven by liability exposure and risk appetite. In some ways that makes it harder to fix. Unlike in the US, there's no single regulator whose stance you can change and watch the pressure lift - the problem is distributed across dozens of institutions each making their own commercial calculation.
Frankly, the timing couldn't be more pointed. The FCA published its final cryptoasset regime rules on June 30, 2026. The authorisation gateway opens September 30. Full mandatory compliance starts on October 25, 2027. The UK government has been loudly positioning itself as a crypto-friendly jurisdiction. Meanwhile, according to The Block's reporting on the UKCBC survey, banks are rejecting roughly four in ten payments to crypto exchanges. The gap between the stated policy and the lived experience of these firms is striking.
The APPG's findings won't be binding. Parliamentary inquiries often produce recommendations that gather dust. But this one arrives at an unusually pressured moment: the FCA authorisation window is opening, MiCA competition from the EU is real, and 70% of the UK's major exchanges have told researchers that banking access problems are making them less willing to stay and build here. These firms are making a business decision, and it's already in progress. If the inquiry surfaces anything concrete, regulators and banks will find it hard to ignore.
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