All Crypto Currency businesses unfortunately fall into the high risk category when it comes to business banking.
There are a number of reasons why Crypto currency businesses struggle with business banking, not least of all because it is totally unregulated by any of the main regulators.
As such it is often linked to things like money laundering, which is one of the biggest concerns for all the major business banks.
But what are the actual risks to the banks if they allow Crypto currency trades?
The real problem is that even when money goes into and subsequently out of an account, the bank could still be at risk
As just because the money may have left an account, if the authorities subsequently discover the money was in anyway involved in an unlawful activity, then it would need to be repaid.
So if the money had already been withdrawn or transferred from the account, the bank would need to repay those funds regardless if there is any money in the account or not.
So this is where the ‘risk’ comes in for the banks who allow a Crypto currency business to trade, as if the funds have gone, the bank will need to repay anyway.
In an example where say £1m had been transacted and was deemed to have been laundered, the bank could potentially lose £1m as they would have to repay that from where it came.
As such, given the amount of revenue the bank may earn from such an account, the risk is deemed as far too high, even for legitimate Crypto currency businesses.
There may be some potential FCA regulated banking providers who would consider this type of business activity, however their business model will work very differently from any of the main banks.
Theses types of business account providers will happily accept some Crypto businesses however they will charge according to risk, meaning they will almost certainly charge a large fee to open an account, then transaction charges which represent their risk.
So there are and will be options available for Crypto currency businesses, however the options will be limited and of those that will be available, you need to expect to pay a premium if you would like them to bank you.
If you would like to speak to someone to see what options are currently available, then call us on 020 3286 3929 or Apply Here