Lloyds has banned its nine million credit card customers from buying Bitcoin after the cryptocurrency more than halved its value in just two months.
Britain’s biggest bank has put a halt on purchases of the digital currency over concerns that it could be left footing the bill for unpaid debts.
Bitcoin’s price has fallen by 57 per cent from £14,000 in December to less than £6,000 last night.
Lloyds has banned its nine million credit card customers from buying Bitcoin after the cryptocurrency more than halved its value in just two months
It is thought that hundreds of thousands of Britons invested in the cryptocurrency last year and Lloyds is worried that its temperamental condition could lead to massive losses for customers.
A spokesman for the bank told the Telegraph it had taken the measure to ‘protect’ its clients.
Lloyds, which has 30million customers, is the first British bank to ban Bitcoin.
However, across the Atlantic a number of big US banks have taken preventative measures, with JP Morgan, Bank of America and Citigroup all halting Bitcoin purchases.
A growing regulatory backlash against the digital coins has sent investors scrambling to sell this week.
Last year’s explosive rise in the value of digital coins and the flood of new retail investors drawn to the market have rattled global regulators nervous about a sector used largely for speculation.
It is thought that hundreds of thousands of Britons invested in Bitcoin last year
Officials have also said cryptocurrencies are used by criminals to launder money.
Connor Campbell, analyst at Spreadex, described Bitcoin’s decline as a ‘horror show’.
He pointed to reports that the US Commodity Futures Trading Commission is investigating whether market manipulation was at play in the cryptocurrency’s rise.
‘The cryptocurrency has had a horror show week already, dragged lower by regulation changes in South Korea and news that Facebook is banning adverts for the product on its site’, the analyst said on Friday.
‘Already feeling delicate, then, Bitcoin was dealt another major blow this Friday, plunging 10.5% to $8,000 following reports that the US Commodity Futures Trading Commission is investigating the cryptocurrency’s ludicrous end of 2017 rise for signs of market manipulation.’