Despite several calls from customers to allow them easier access to Bitcoin (BTC) trading services, Denmark’s largest bank Danske Bank A/S has noted that it would not lift its ban on crypto trading activities.
Danske Bank A/S noted in an announcement shared on its website that it has decided to maintain a cautious approach toward cryptocurrency investment.
“We recognize that there is a significant global market for cryptocurrencies and that many customers find cryptocurrencies interesting. However, as a financial institution, Danske Bank for several reasons maintains a very cautious approach towards cryptocurrencies.”
According to the bank, it has chosen to maintain a “cautious approach toward cryptocurrencies” because of several reasons, including high volatility associated with the investment, and the unclear regulation for crypto trading.
It is at present not possible to trade cryptocurrencies or financial instruments based on cryptocurrencies on Danske Bank’s trading platforms, and we generally advise against investing in such assets. Thus, we cannot currently offer investment advice on cryptocurrencies or financial instruments based on cryptocurrencies.
— Danske Bank Statement on Cryptocurrencies
Danske Snubs Crypto Over Money Laundering & Environmental Concerns
Danske Bank also raised concerns about the anonymous feature of cryptocurrencies, which it believes could be exploited by criminals to conduct illicit transactions such as money laundering and terrorist financing.
With crypto having very limited transparency, Danske noted that it could undermine its capability to fight several illicit transactions that have been linked to the assets.
Danske’s concern about the possibility of crypto actors adopting crypto in illicit transactions is understandable given that financial regulators are investigating the bank for conducting money laundering in Europe and the United States.
It fears that granting customers their wish to trade cryptocurrencies on its platform could worsen its ordeal with financial regulators.
Furthermore, Danske added that it will not offer crypto trading services because of the carbon footprint that cryptocurrency mining causes on the environment.
Per the announcement, Danske said the environmental implications of mining crypto, especially Bitcoin, go against its objectives of promoting sustainable development for its customers.
This has been a major topic of discussion across various sectors. Last month, Elon Musk, the CEO of popular American electric car company Tesla, noted that the firm would no longer support Bitcoin payments due to the high carbon footprint on the environment.
However, Tesla CEO Elon Musk later made a U-turn this month to continue supporting Bitcoin payments for its car purchases only when Bitcoin mining is done with at least 50% of renewable energy.
Banks Now Offering Cryptocurrency Trading Services
Meanwhile, despite Danske’s refusal to offer crypto trading services to clients, several top financial institutions globally, including BNY Mellon, have since added Bitcoin trading to their list of services.
Since demand for the assets has grown significantly in recent times, the banks fear that failure to get involved in cryptos could see them lose their clients to competitors that are not scared of the investment.
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