BANKS stepped into stop customers making cryptocurrency transactions on their credit cards yesterday because they were being hit by millions in claims.
Insiders say lenders including Lloyds, Virgin Money and others were inundated with requests for refunds after customers lost out big time after a bloodbath on the markets yesterday.
According to insiders banks were hit with claims after customers lost money on the run up to the worst day to hit crypto this year as a litany of fraud schemes hit the unregulated market.
Scott Ryder, head of sales of CryptoGo said: “The word on the street is that banks became quickly aware of the fact that customers using credit cards to pay for crypto transactions were insured for purchases.
“We’ve heard from multiple sources that the credit bans came in after customers lost money and went straight to the banks to reclaim money.
“Banks’ credit card protection for purchases helps customers get a full refund but with so many wild card tactics out there, they were set to lose billions from fraud schemes.
“Credit card payment protection is completely free and comes automatically with every credit card – meaning the banks felt they were on dodgy ground, word spread like wild fire and it was enforced across the city like lightening.”
Banks stepped into stop losses
Customers from Lloyds Bank, Bank of Scotland, Halifax and MBNA are being prevented from using their credit facilities to access the markets.
Lloyds was the first bank to implement the change but refused to be drawn on why.
A spokesman said: “We continually review our products and procedures and this is part of that.”
Virgin Money also joined the crypto ban as did a number of other banks worldwide after news spread that traditional lenders who have been wary of the unregulated markets were being hit by claims.
Total market capitalisation dropped to $280 billion from highs of $826 billion on January 7 2018.
But it has rebounded today to $310bn as money starts to flood back into the market following the initial crash.
Bitcoin is leading the way with the drop while at the same time charging ahead with its dominance of the market raking in a 36.9% share – up two percent on last week.
The markets are reacting to Governments around the world taking a firm stance on anonymous and global trading and exchange platforms.
And as more ICOs get set to enter the market to join the 1514 currently trading on 8569 exchanges – there’s trouble ahead for investors.