It’s no secret that banks and cryptocurrency exchanges don’t have the best relationship. Banks are notoriously risk-averse, and they’re not too keen on the idea of their customers using their accounts to buy and sell digital assets.
exchanges, on the other hand, need banks in order to function. After all, most exchanges don’t hold any customer funds themselves – they simply facilitate transactions between buyers and sellers. So what happens when a customer wants to buy crypto on an exchange like Coinbase using their bank account? Do banks allow Coinbase?.
The answer, unfortunately, is a bit complicated. It depends on the bank in question, as well as the country where the customer resides. In some cases, banks have outright banned their customers from buying crypto on Coinbase.
In others, they’ve simply restricted crypto-related transactions or made them more difficult to carry out. And in still others, there have been no issues whatsoever.
Banks that have banned Coinbase include JP Morgan Chase, Bank of America, Citigroup, and Discover. These bans were generally instituted in early 2018, when crypto prices were skyrocketing and mainstream interest in digital assets was at an all-time high.
At the time, banks were worried about their customers using credit cards to buy crypto, as this could lead to massive losses if prices crashed (as they eventually did). As a result, they decided to ban all crypto-related transactions – even those involving exchanges like Coinbase that use ACH transfers (which are much less risky than credit card purchases).
Other banks have taken a less heavy-handed approach. Wells Fargo, for example, has restricted its customers’ ability to buy crypto on Coinbase.
Customers can still do so, but they can only purchase $50 worth of digital assets per day (and $200 per month). This limit was put in place in early 2018 as well, but it’s unclear if it will remain in effect indefinitely or if it will eventually be increased.
Finally, there are some banks that have no problem with their customers buying crypto on Coinbase. These include major US financial institutions like Capital One and TD Ameritrade.
Canadian banks such as RBC and TD Canada Trust have also been reported to allow Coinbase transactions with no issues.
So what’s the bottom line? Do banks allow Coinbase? It depends – each bank has its own policies regarding cryptocurrency purchases. Some have outright banned their customers from buying digital assets on exchanges like Coinbase, while others have simply put limits in place.
And still others have no problem with it whatsoever. If you’re not sure whether your bank allows Coinbase transactions, your best bet is to contact them directly and ask.