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Kroo, a digital bank based in London, recently declared it will no longer permit customers to carry out cryptocurrency transactions. This step addresses the rising number of online scams and fraud cases tied to crypto.
Under Kroo’s revised terms, accounts will face restrictions if they “use your account to purchase or trade in cryptocurrency or you receive credits to your account which arise from cryptocurrency trading or transactions. If we detect such activity we will not process the payments involved, and if you persistently make such transactions we may close your account.” Moreover, Kroo retains the right to freeze accounts suspected of engaging in crypto activities.
Starting from 30 May 2024, Kroo will cease to support bank transfers or card transactions related to cryptocurrencies. The bank confirmed, “From 30 May 2024, we will no longer support bank transfers or card transactions associated with cryptocurrencies.”
As a challenger bank, Kroo competes against established financial institutions. It follows the lead of other U.K. challenger banks like Starling Bank and Chase UK in banning crypto transactions.
Globally, banks have raised alarms about the safety of cryptocurrencies. Critics argue that crypto is not as anonymous or secure as many believe. For instance, the Central Bank of Russia reported in February that nearly half of the country’s 2023 financial fraud cases involved cryptocurrencies and foreign currencies.
Similarly, in the U.S., Federal Reserve officials have highlighted the potential for fraud and scams if banks adopt cryptocurrencies or Central Bank Digital Currencies (CBDCs).