Bitcoin Magazine

UK Banks Still Blocking Bitcoin, Policy Group Tells Parliament

Bitcoin Policy UK has slammed British banks for applying blanket restrictions to lawful bitcoin activity. 

The organization said in an announcement Friday that it had submitted evidence to the Crypto and Digital Assets APPG’s parliamentary inquiry into banking access, revealing that no improvements had been made over the past three years in how banks treat bitcoin activity. 

The issue: UK policy treats “crypto” as one thing, so bitcoin is caught by rules written for unbacked tokens and issuer-dependent stablecoins.

The British government has said since 2023 that banks should assess case by case rather than restrict by sector. The group says practice has not followed, and that the gap is widening as the UK moves toward full implementation of its cryptoasset regime in 2027. 

Almost three years after we first raised blanket banking restrictions with the City Minister, our evidence to the Crypto and Digital Assets APPG inquiry shows the problem hasn’t improved. Roughly 40% of bank-to-exchange transfers in the UK are currently blocked or delayed.

We’re…

— Bitcoin Policy UK (@bitcoinpolicyuk) August 23, 2026

Bitcoin Policy UK called on British banks to give reasons for rejecting bitcoin-related activity. 

“Almost three years after we first raised blanket banking restrictions with the City Minister, our evidence to the Crypto and Digital Assets APPG inquiry shows the problem hasn’t improved,” Bitcoin Policy UK said in a Sunday post on X.  

“Roughly 40% of bank-to-exchange transfers in the UK are currently blocked or delayed.”

The organization filed evidence with the Crypto and Digital Assets All-Party Parliamentary Group’s inquiry into banking access. 

A joint survey by Startup Coalition, the UK Cryptoasset Business Council and Global Digital Finance, published in January 2025, found that half of the UK fintech and crypto firms it canvassed had been refused a bank account or had one closed, and that only 14% had opened and kept an account with one of the country’s nine largest banks. Most were UK-based operations rather than firms with no domestic presence.

Virgin Money, Metro Bank, Starling Bank, TSB and Chase UK block transfers and card payments outright, while Barclays and HSBC cap transfers at £2,500 ($3,400) per transaction, Bitcoin Policy UK said. 

It added that 80% of the exchanges said restrictions had increased over the previous year. None reported an improvement. An IG Group survey from August 2025 found 40% of active crypto investors had a payment blocked or delayed by their own bank.

The submission makes four requests: a regulatory statement that bitcoin activity through an FCA-registered exchange should not face blanket restriction; a duty on banks to give specific reasons and an appeals route; confirmation that FCA registration can serve as a risk basis, as in Hong Kong; and a published periodic measure of restriction levels.

In December, City Minister Lucy Rigby said that Britain can “without a doubt” compete with the United States and become an international hub for cryptoassets.

This post UK Banks Still Blocking Bitcoin, Policy Group Tells Parliament first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.

The line between traditional finance and crypto just got a lot thinner.

For years, banks watched stablecoins from the sidelines. Now they’re stepping onto the field and some are already preparing to issue their own.

This isn’t another hype cycle. It’s a quiet but significant shift in how money moves, settles, and earns yield. When regulated banks begin issuing stablecoins, the entire financial plumbing changes. Here’s what that future looks like, why it matters, and what it means for everyday users, institutions, and the broader crypto market.

Why Banks Are Entering the Stablecoin Game

Stablecoins have already proven their utility. They move value across borders in minutes instead of days, settle 24/7, and sit on transparent ledgers. Tether and USDC process hundreds of billions in volume monthly. That kind of efficiency is hard for banks to ignore especially when their own customers keep asking for faster, cheaper ways to move money.

Regulators have also shifted tone. In several major jurisdictions, frameworks for bank-issued digital dollars (or euro, yen, etc.) are taking shape. The message is clear: if stablecoins are going to be part of the financial system, better they come from institutions that already face capital requirements, AML rules, and consumer protection standards.

For banks, issuing a stablecoin isn’t just about keeping up. It’s about reclaiming territory. Right now, a large share of on-chain dollar activity lives outside the traditional banking system. A bank-issued stablecoin brings that activity back onto their balance sheet, under their compliance umbrella, and potentially into their product suite.

What Changes When Banks Issue the Coins

1. Trust and regulation get baked in Most current stablecoins rely on reserves held at banks or in short-term Treasuries, with varying levels of transparency. A bank-issued version can carry the full weight of the bank’s charter, deposit insurance frameworks (where applicable), and regulatory oversight. That doesn’t make them risk-free, but it does change the risk profile. Institutional treasurers and risk committees who currently hesitate may suddenly find the product acceptable.

2. Settlement rails get upgraded Banks already sit at the center of payment systems. Pair that with a programmable digital dollar and you get near-instant settlement between counterparties that currently wait for ACH or wire windows. Cross-border payments, which still rely on correspondent banking chains, become dramatically simpler when both ends of the transaction can hold the same bank-issued stablecoin.

3. Yield and product design evolve Some bank stablecoins may remain non-yielding (closer to digital cash). Others could offer interest, depending on regulatory treatment. Either way, banks can layer familiar products credit lines, treasury management tools, escrow services on top of the token. The stablecoin becomes infrastructure rather than the product itself.

4. Liquidity and market structure shift Today’s major stablecoins dominate on-chain liquidity. Bank-issued versions could fragment that market at first, then consolidate around the most trusted and widely accepted ones. Exchanges, DeFi protocols, and payment apps will need to decide which bank coins to support. Network effects will matter a lot.

The Practical Impact on Users and Businesses

For individuals, the most visible change may be in everyday payments and remittances. Imagine sending money abroad without the usual 3–7 day wait or the 5–10% fee haircut. Or holding a digital dollar that can move into a savings product, a payment app, or a trading platform without leaving the regulated banking perimeter.

For businesses, the upside is operational. Payroll, supplier payments, and intercompany transfers can settle in minutes. Working capital gets freed up because money spends less time trapped in transit. Treasury teams gain real-time visibility into balances that currently sit in opaque correspondent accounts.

Institutions already exploring tokenized deposits and on-chain settlement will find bank stablecoins a natural extension. The difference is that these tokens come with the bank’s name and regulatory status attached.

Risks and Open Questions

This transition won’t be frictionless. Several issues still need clarity:

• Interoperability: Will different banks’ stablecoins talk to each other easily, or will we end up with siloed digital dollars?
• Reserve and redemption rules: How quickly can holders redeem for fiat, and under what stress scenarios?
• Competition with existing stablecoins: Will bank versions coexist with, or gradually displace, the current leaders?
• Monetary policy transmission: Central banks are watching closely. Widespread use of bank-issued digital money could change how policy rates flow through the system.

There’s also the question of innovation speed. Banks move carefully by design. Pure crypto-native stablecoin issuers have iterated faster. The challenge for banks will be delivering the reliability of traditional finance without losing the speed and programmability that made stablecoins useful in the first place.

Looking Ahead: Crypto Banking 2.0

We’re not talking about banks “adopting crypto” in the superficial sense of offering a trading app. This is deeper. It’s banks treating digital dollars as a core product and settlement layer.

In the best version of this future, users get faster, cheaper, more programmable money that still sits inside a regulated framework. Liquidity becomes more resilient. Compliance becomes clearer. And the boundary between “crypto” and “banking” starts to dissolve into something more practical: just better money rails.

That future is already being built in regulatory sandboxes, pilot programs, and boardroom discussions. The institutions that treat stablecoins as infrastructure rather than a side experiment will shape the next decade of payments and settlement.

Crypto Banking 2.0 isn’t about replacing banks. It’s about banks finally building the kind of digital money the market has been demanding for years only this time, with their own name on it.

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Crypto Banking 2.0: What Happens When Banks Start Issuing Stablecoins? was originally published in Coinmonks on Medium, where people are continuing the conversation by highlighting and responding to this story.

The secretive satellite agency’s work with prime contractors to address supply chain issues could inform broader federal efforts to address supplier risks.

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Bitcoin Magazine

Citi to Debut Bitcoin Custody for Institutional Investors

Citi will debut a bitcoin custody service later this year. The top bank said Tuesday that its Custody+ product will allow institutional investors to custody both traditional assets and bitcoin within one framework, rather than needing separate systems. 

The bank first announced plans to debut a digital asset custody service last year. It said at the time that it had been developing the service for several years. 

Citi is the latest American bank to move deeper into the digital asset space following friendlier legislation and pro-crypto approach from U.S. regulators. 

JUST IN: $2.8 trillion bank Citi announces they will go live with Bitcoin custody services later this year pic.twitter.com/hfIZIJIh7o

— Bitcoin Magazine (@BitcoinMagazine) August 18, 2026

“Custody+ is a clear example of this investment as we build infrastructure to eliminate latency and drag for institutional investor clients,” Head of Investor Services at Citi, Chris Cox, said in a statement.

The service, according to Citi, will let clients process every asset servicing transaction through a “single seamless flow.”

Clients will get continuous, near-instant visibility and execution across servicing, settlement, FX, cash, and data — plus the flexibility to plug in digital assets or build their own offerings on top of Citi’s rails — instead of being locked into a single standardized custody workflow.

Citi’s new custody service runs parallel to its broader blockchain offerings, including Citi Token Services, which enables real-time cross-border payments using tokenized deposits.

The firm since last year has also been working with other top banks — including Deutsche Bank, Goldman Sachs, and Bank of America — to explore issuing a stablecoin product.

Speaking about the long-awaited crypto Clarity Act last week, Citigroup CEO Jane Fraser said that the bank was a “leader in digital assets.” She added that while the legislation needed some improvements, the bank wanted a “good bill to go through.”

The Clarity Act, which aims to define which tokens qualify as securities versus commodities, is the latest pro-crypto legislation. Lawmakers will vote on the bill in September. 

This post Citi to Debut Bitcoin Custody for Institutional Investors first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.

Banking Groups Push Senate To Rewrite Stablecoin Yield Rules is a useful reminder that crypto coverage is not only about token prices. Sometimes the more important story is the infrastructure, regulation, security, or product layer sitting underneath the market noise.

The immediate point is straightforward: a coalition of banking groups reportedly urged the Senate to revise stablecoin yield rules. That gives readers something concrete to work with, rather than another vague sentiment update.

TL;DR

• A coalition of banking groups reportedly urged the Senate to revise stablecoin yield rules.
• The letter is tied to the CLARITY Act debate.
• The dispute highlights tension between banks and crypto issuers over yield-bearing instruments.

Why This Matters Now

The timing matters because Stablecoins is already part of a wider conversation across the market. Traders want to know whether the development changes liquidity or risk. Builders want to know whether it changes what can be deployed. Compliance teams want to know whether it changes how platforms operate.

In that sense, the story is bigger than one headline. It sits inside the ongoing shift from speculative crypto cycles toward more practical questions: who can use these systems, how safe are they, and whether the underlying incentives actually work.

The best way to read it is with discipline. It is not a guarantee of immediate upside, and it should not be treated as one. But it does add a fresh data point to the way the market is thinking about Stablecoins.

The Stablecoins Angle

For Stablecoins, the important part is the specific mechanism. If this is a security issue, the risk sits in dependencies and user protection. If it is a listing or product launch, the question is access and liquidity. If it is a governance or research proposal, the question is whether the idea can survive implementation.

That is where this update becomes useful. It is not just a label attached to a trend. It gives readers a way to understand what might actually change if the development gains traction.

Crypto has a habit of turning every announcement into a broad market claim. This one deserves a narrower read. The value is in seeing how it affects the users, developers, institutions, or traders closest to the issue.

The Risk Side

There is also a caution attached. Source material can confirm that a development exists, but it cannot prove that adoption will follow. A proposal still needs support. A product still needs users. A chart still needs confirmation. A compliance tool still needs integration.

That is why the responsible reading is not to oversell the story. The stronger takeaway is that this adds to a pattern. The crypto market is steadily becoming more professional, more technical, and more sensitive to real operational details.

Readers should also watch for follow-up signals. That could mean developer feedback, exchange support, regulatory response, wallet adoption, liquidity data, or simply whether market participants continue reacting after the first headline fades.

What Comes Next

The next stage will decide whether this remains a narrow update or becomes part of a larger market theme. In crypto, that difference matters. Plenty of stories look important for a few hours and then disappear. The ones that last usually show up again through usage, liquidity, enforcement, governance, or developer adoption.

For now, this gives the market another piece of information to weigh. It is specific enough to be useful, but still early enough that readers should keep the caveats in view.

That makes it worth covering without pretending it settles anything. The story is a signal, not a final verdict.

The key is not to confuse coverage with certainty. Stablecoins stories can move quickly, especially when they touch security, regulation, listings, infrastructure, or price levels. The useful approach is to track the next confirming detail rather than assume the first update carries the whole market story. That is how traders avoid chasing noise and how readers separate a genuine development from another passing headline.

This report is based on information from beincrypto.com.

This article was written by the News Desk and edited by Samuel Rae.