Bank Of America, JP Morgan Bar Crypto Purchases On Credit Card

The latest crackdown against cryptos was unveiled on Thursday when the largest US bitcoin exchange, Coinbase, sent out notices to clients, informing them that purchasing cryptocurrencies on credit would now be prohibitively expensive, if not impossible, as banks have started to process payments for bitcoin et al as "cash advances", which tend to come with extremely high interest rates:

Dear Coinbase Customer

We’re writing because you have a credit card on file and want to inform you of a recent change that may increase the cost of purchasing digital currency with a credit card.

Recently, the MCC code for digital currency purchases was changed by a number of the major credit card networks. The new code will allow banks and card issuers to charge additional "cash advance" fees. These fees are not charged or collected by Coinbase. These additional fees will show up as a separate line item on your card statement.

The move came as a number of bank and card issuers announced that they would be reviewing changes to their policies around the purchases of crypto assets using credit cards.

Then, last Thursday the Wall Street Journal reported that Capital One banned customers from using credit cards to purchase bitcoin or coins on the Ethereum blockchain, citing “limiting mainstream acceptance and the elevated risks of fraud, loss and volatility.” Discover Financial announced it would likewise block bitcoin transactions.

Then yesterday, MarketWatch  reported that Bank of America and other major lenders are assessing the use of credit cards to purchase bitcoin and other virtual currencies, which could result in restrictions or limits.

Today that was confirmed when Bank of America became the largest U.S. lender yet to bar customers from using their credit cards to buy cryptocurrencies.

According to an internal memo to employees obtained by Bloomberg, the second largest US bank said it “will begin declining credit card transactions with known cryptocurrency exchanges” starting today. It said the policy will apply to all personal and business credit cards issued by the bank.

Betty Riess, a spokeswoman for the Charlotte, North Carolina-based bank, confirmed the bank will no longer allow the transactions. 

And then, moments later, JPM joined the fray too:

  • JPMORGAN TO HALT CRYPTO PURCHASES ON SATURDAY, SPOKESWOMAN SAYS

As a reminder, a recent LendEdu survey revealed that just over 18% of bitcoin purchases were made using a credit card.

 

The good news: 82% of all crypto purhcases were not made using a credit card.

Comments

overbet quadraspleen Fri, 02/02/2018 - 15:44 Permalink

I dont use credit which is why I have an 800+ fico, but I see the appeal of burning your credit rating to freeroll. I spent years actively trying to build my credit rating because I was brainwashed and thought a good rating was important. Now I avoid credit as much as possible. I have a couple platinum travel cards for the perks and seat upgrades that I run my expenses on, but auto transfer to pay them off every statement. 

In reply to by quadraspleen

Hoffman Lenz Jack's Raging … Fri, 02/02/2018 - 17:24 Permalink

What is a credit score?

As I see it, it's just another way for them to have control over you.

I often wondered after seeing the ads on the telly, why it was free to check your credit score, if it was such an important thing.

I figure that, until you get in touch with them and give them all your details, they know nothing about you. Then they start to put the financial pieces of your life together.

I guess I'm lucky. I don't need credit (read: debt) so, as I see it, I don't need a credit score.

I could be being as bit naive here. Perhaps someone could explain why I need a credit score.

In reply to by Jack's Raging …

eclectic syncretist overbet Fri, 02/02/2018 - 15:44 Permalink

Are my eyes fucked up or did I just actually read that THE FBI REPEATEDLY LIED TO THE COURTS in order to SPY ON A DOMESTIC CAMPAIGN with the intention of SUBVERTING AN AMERICAN PRESIDENTIAL ELECTION??????  WTFFFFFFFFFFFF????

Close the country down. It's fucking over now. Banana republics at least have the legitimacy of being known as such.

In reply to by overbet

Consuelo eclectic syncretist Fri, 02/02/2018 - 16:09 Permalink

The one whom all this centers around (H. Rodham Klinton), and her dutiful wife, made a science in the intricacies of:

- Deny

- Delay

- Obfuscate

During their 8-year tenure - and that doesn't count the other 28+ years before & after.    

It is the perfection of this form of diversion and obfuscation that lands us (collectively speaking) in the mire we are today; impotent, distracted, confused, feminized and disengaged.  

In a saner time, the U.S. Marshals would have had Obama and nearly his entire cabinet, HRC and her wife and a host of other .gov and non-gov entities in shackles before a magistrate, with cameras rolling.

In reply to by eclectic syncretist

Sudden Debt Mr. Universe Fri, 02/02/2018 - 16:40 Permalink

At 4K I'll start buying some untill it goes to 2.5K 

Last time I did that, I made a shitload of money.

 

And a bank might ban bitcoin purchases with visa's but they can't ban you from wiring money to a trading account.

 

Also, banks don't have the right to ban you from buying anything. It's your money and you can waste it on anything you want.

 

 

In reply to by Mr. Universe