UK parliamentary group launches inquiry into crypto banking

The Crypto and Digital Assets All‑Party Parliamentary Group (APPG) announced a formal inquiry on July 21, 2026, into whether UK banks are restricting access for crypto firms and consumers—a move that could affect up to 40% of attempted crypto‑related transfers and shape the sector’s growth prospects【1】.

Scope of the investigation

The APPG, co‑chaired by Labour MP Gurinder Singh Josan and Lord Ed Vaizey, will collect written evidence from banks, payment providers, crypto firms and consumer groups over a six‑week period before publishing recommendations to Parliament【3】. The focus is on three fronts: (1) account closures or refusals to onboard crypto businesses, (2) payment blocks and daily transfer limits imposed on retail customers, and (3) access to ancillary services such as insurance. Major UK banks—including HSBC, NatWest, Santander, Nationwide and Starling—have already introduced controls ranging from outright blocks to capped transfers, citing fraud prevention and AML concerns【2】.

Industry reaction and numbers

A January survey by the UK Cryptoasset Business Council (UKCBC) found that ten exchanges reported banks blocked or delayed 40% of transactions to crypto platforms, with eight noting an increase in blocked transfers over the previous year【1】. One unnamed exchange claimed banks declined roughly £1 billion in transactions over a year, covering rejected card payments and open‑banking transfers【1】. The same survey showed 70% of respondents said the banking environment reduced their willingness to invest, expand or hire in the UK【1】.

Yuriy Brisov of Digital & Analogue Partners warned that banks’ “blanket policies and fixed transaction caps” fail a basic proportionality test, treating high‑risk and low‑risk firms alike【1】. He also highlighted that UK reimbursement rules for authorized push‑payment fraud—requiring banks to cover losses up to £85,000 per claim since October 2024—may incentivise banks to block crypto‑linked payments rather than assess each case individually【1】.

Regulatory backdrop

The inquiry arrives as the FCA prepares to accept crypto firm authorisation applications from September 30, 2026, creating a potential clash between the UK’s ambition to become a global crypto hub and the continued banking restrictions on even FCA‑registered exchanges【1】. The upcoming Cryptoassets Regulations, laid before Parliament in December 2025 and slated to take effect in October 2027, further underscore the tension between regulatory approval and practical banking access【1】.

What to watch

• Evidence deadline: Submissions close on Aug. 31, 2026; the APPG’s report will follow shortly after.
• FCA authorisation window: Applications open Sept. 30, 2026—watch for any statements linking licensing outcomes to banking access.
• Potential policy shifts: Any indication that banks will differentiate between FCA‑registered and unlicensed platforms could signal a change in the “debanking” landscape.

The inquiry’s findings could determine whether UK banks adjust their risk frameworks to accommodate regulated crypto firms, or whether the sector continues to face systemic access barriers that may drive investment abroad. The outcome will be a key barometer for Britain’s claim to be a leading digital‑asset hub.