Bank of Spain Reminds Public Cryptocurrency Purchases Can Be Blocked in Certain Cases – The Bank of Spain, Spain’s central bank, has issued a warning to users regarding the actions that banks may take if they identify bitcoin purchases.
Traditional banks have the option to prohibit these transactions if they suspect dubious conditions, like those related to fraudulent activity or money laundering, according to a post on the institution’s website.
The Bank of Spain has published a post outlining the steps that commercial banks may take if they detect a cryptocurrency-related purchase. First and foremost, the bank states that these assets are not suitable for use as payment options or investment vehicles, according to Spanish and European regulators.
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Accounts might also be blocked as a result of questionable behavior linked to identity theft, according to the bank. It explained:
“It’s possible that the bank has concerns of identity fraud involving credential theft. There are numerous incidents of fraud in which an entity’s clients’ accounts are accessed fraudulently after the client’s passwords are obtained, and which result in a transfer to obtain cryptocurrencies.”
This could set off alarms in the banking system, resulting in the aforementioned block to safeguard the customer.
Other factors, however, could result in a transaction restriction. The article goes on to say that evidence linking funds exchanged with money laundering can also result in a cryptocurrency purchase transaction being blocked.
In this regard, the bank stated:
“It’s also possible that the bank will classify this type of transaction as high-risk and impose new controls, such as making a phone call or asking you to visit the branch.”
Banks are bound by a set of laws that prohibit them from engaging in transactions that could be used to launder money around the world.
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However, banks are unable to do so without keeping a line of communication with the impacted user and providing a general rationale for the transaction’s blockage.
Users may be required to visit a bank branch in specific situations. However, the article states that banks must be flexible depending on the customer’s health and the proximity from their home.
MiCA, the Markets in Crypto Assets regulatory framework, is currently being drafted in Europe to better clarify the attributions of each entity regarding cryptocurrencies and its connected actors.
