BofA bars customers from using credit cards to buy cryptocurrencies
Bank of America announced Friday that it would begin flagging and declining transactions made with credit cards to known cryptocurrency exchanges, Bloomberg News reported.
A spokeswoman for the nation's second-largest credit card issuer told Bloomberg that the bank would begin declining such transactions as early as Friday. It was unclear if the ban extends to all purchases made with Bank of America accounts, including debit cards.
The Charlotte-based bank “will begin declining credit card transactions with known cryptocurrency exchanges," according to a memo sent to staff today.
Bank of America did not immediately respond to a request for comment from The Hill.
Cryptocurrencies experienced one of the most volatile months on record last month when Bitcoin lost thousands of dollars in value in a matter of days.
Other credit card companies have also taken steps to prohibit consumers from using their cards to purchase cryptocurrencies. Capital One Financial Corp. and Discover Financial Services both do not support the transactions, according to Bloomberg, while the largest U.S. card issuer JPMorgan Chase & Co. still allows the transactions.
Earlier this week the U.S. Commodity Futures Trading Commission (CFTC) announced an investigation into one of the biggest cryptocurrency trading platforms, Bitfinex. The move caused cryptocurrency markets to drop after a month of already record losses.
Bitcoin biggest bubble in history, says economist who predicted 2008 crash
Nouriel Roubini calls cryptocurrency the ‘mother of all bubbles’ as it falls below $8,000
The economist credited with predicting the 2008 global financial crisis said a 12% fall in the value of bitcoin on Friday was the latest proof that the cryptocurrency was the biggest bubble in history and destined for a crash.
Nouriel Roubini, professor of economics at New York University, said bitcoin was “the mother of all bubbles” favoured by “charlatans and swindlers” as it fell below $8,000 (£5,600) early on Friday, marking a 30% drop since the beginning of the week as investors became increasingly twitchy about a clampdown on cryptocurrencies by regulators. Later it rallied, climbing back over $8,600 by 3pm (GMT).
Bitcoin has lost more than half its value since hitting a peak of near $20,000 in the week before Christmas. Dubbed “Dr Doom”, Roubini said the sharp fall was the beginning of a crash that would see the value of the digital currency plummet “all the way down to zero”.
The latest sell-off follows reports that US regulators are investigating whether the spike in the price of bitcoin in 2017 was the result of market manipulation. India’s finance minister said the country did not recognise the cryptocurrency as legal tender, pledging to fight their use for “illegitimate activities”.
Digital currencies have also been hit by the news that Facebook is banning all adverts for cryptocurrencies. Ethereum, ripple, litecoin and other digital currencies all suffered double-digit percentage falls on Friday as investors took fright.
“Policymakers and regulators are getting worried. Pretty much every G20 policymaker is talking about a crackdown,” Roubini told Bloomberg Television. “We can’t allow it to become the next Swiss bank account for use by criminals and people evading tax.”
He added that the 1,300 cryptocurrencies or initial coin offerings currently in existence were “a scam”. “Most of them are even worse [than bitcoin] and don’t have any intrinsic value like bitcoin. So if bitcoin is a bubble, it’s a bubble to the power of two or three.”
Critics have warned that bitcoin has all the hallmarks of a classic speculative bubble that could burst, like the dotcom boom and the US sub-prime housing crash that triggered the global financial crisis. Last year it rose in value by more than 900%, making it the best performing asset of 2017.
Robert Shiller, the Nobel prize-winning economist, said last week that while bitcoin was a “really clever idea”, it would not become a permanent part of the financial world.
“I tend to think of bitcoin as an experiment. It is an interesting experiment, but it’s not a permanent feature of our lives,” he said, speaking at the World Economic Forum in Davos.
Bitcoin is not recognised by any central bank and currently allows people to bypass banks and traditional payment methods to pay for goods and services. Banks and other financial institutions have been concerned about bitcoin’s early associations with money laundering and online crime, and it has not been adopted by any government.
However, the spike in the price is forcing regulators and institutions to consider how to respond.
Jon Cunliffe, deputy governor for financial stability at the Bank of England, has said that bitcoin is too small to pose a risk to the global economy. However, he warned that investors should “do their homework” before backing the digital currency.
“The wheels are coming off the bitcoin bandwagon,” said Neil Wilson, analyst at ETX Capital. “The regulatory crunch appears closer than ever and sooner or later this market could be headed back down to earth. Selling pressure at the moment is intense as there has been nothing but bad news for bitcoin bulls of late. Trying to catch the falling knife is a risky game.”
Tether still at $0.994547, right at that $1.00 mark like it's supposed to be. Many still using it. If it was a sham, had no money reserves and were sent a subpoena back in December why would they still be issuing more USDT? [Reply]
Originally Posted by Iowanian:
Those poor, stupid bastards that borrowed money to buy high.....and I know at least 2.
Reading back through this thread in December/January is fun. One of the self-proclaimed "crypto-geniuses" was posting a lot was bragging about moving all his profits into Verge. It has fallen by 70% since then. Ouch. [Reply]
Bitcoin up over $800 in last 24 hours. I only have about 1/5 of a bitcoin but was thinking this can be sold and bought back working the highs and lows. This damn thing has a thousand dollar swing every day. [Reply]
Originally Posted by Hog's Gone Fishin:
Bitcoin up over $800 in last 24 hours. I only have about 1/5 of a bitcoin but was thinking this can be sold and bought back working the highs and lows. This damn thing has a thousand dollar swing every day.
It's ignorant, but it's bounced hard enough after hitting my buy order it has nearly dug me out of my GBTC hole.
I'm trying to treat it like commodities on crack, but the emotional swings are much stronger and much faster than a bunch of farmers worried about the rain.:-) [Reply]
Originally Posted by ghak99:
It's ignorant, but it's bounced hard enough after hitting my buy order it has nearly dug me out of my GBTC hole.
I'm trying to treat it like commodities on crack, but the emotional swings are much stronger and much faster than a bunch of farmers worried about the rain.:-)
Originally Posted by ghak99:
It's ignorant, but it's bounced hard enough after hitting my buy order it has nearly dug me out of my GBTC hole.
I'm trying to treat it like commodities on crack, but the emotional swings are much stronger and much faster than a bunch of farmers worried about the rain.:-)
It isn't us. It's a bunch of fucks in Chicago worried about the rain.....In Argentina. [Reply]
Originally Posted by Buehler445:
It isn't us. It's a bunch of fucks in Chicago worried about the rain.....In Argentina.
Oh for sure, but I play it the same.
You know how it works, they make it move by playing on our emotions and screaming "drought, drought", "flood, flood", "too many pigs", "not enough cows", when in reality it was a 1/4" rain instead of a 1/2" rain and just an attempt to move contracts or influence acres. Crypto pros seem to do the same, only they seem to be snorting bigger lines of much higher purity and you have to make up your mind to get in or out in a matter of minutes instead of days in order to advantage of the overreaction of the sheep.
Wait for the next big crypto news and plot out the chart on gdax. It seems very much like watching the commodities market on crack. [Reply]
