Cryptocurrency growth has stagnated over the past couple months, but that’s not stopping a major Canadian bank from taking action against it.
TD Bank has announced they are taking a pause on allowing customers to purchase cryptocurrency with their credit cards, according to a report from the Canadian Press. The biggest bank in Canada says the decision is based around reviewing and assessing the evolving market.
The top five credit card issuers in the U.S. have all announced or implemented bans on purchasing cryptocurrency with their cards. Those five are Citigroup, Bank of America, Capital One, JPMorgan and Discover.
TD Bank is the first Canadian organization to come out with a ban on purchasing cryptocurrency. Other banks like RBC have said they allow it under certain circumstances, but advise customers to be wary of the fluctuating value. Bitcoin, the most popular cryptocurrency, hit $20,000 USD in December 2017 before plummeting below $10,000 in January. Besides bitcoin, other popular cryptocurrencies are ethereum and litecoin.
Several cryptocurrency exchanges allow customers to purchase with a credit card. Coinsquare is a popular and successful Canadian exchange that allows it, having just raised $30 million earlier this month. There are several other exchanges that allow the practice as well, and the fees usually come in around four per cent per transaction. Coinsquare is the second-most popular cryptocurrency exchange in Canada trailing QuadrigaCX.
It has been tough to ignore the prevalence of cryptocurrency over the past year. Mark Machin the head of Canada Pension Plan Investment Board, said “It’s worth paying serious attention to,” though noted it won’t be included in pension investments anytime soon.
Hopefully, this move by TD does not prompt other banks to follow suit. Shutting down cryptocurrency sales in an effort to keep customers away from risky investments will only hurt the cryptocurrency world further and stagnate the growth of homegrown exchanges. Not to mention people will find a way without them, whether it be Interac Online or another method like Flexepin.