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05-Feb-2018<br />

Lloyds bans Bitcoin purchases on credit cards as cryptocurrency slide continues<br />

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Bitcoin fell to its lowest point since April 2013 on Friday as regulators crack down on trading<br />

of digital currency Some economists expect the Bitcoin boom will come to an end<br />

Lloyds Banking Group PLC ( LON:LLOY ) has banned its customers from buying Bitcoin on<br />

their credit cards amid concerns the cryptocurrency is headed for a crash.<br />

The bank is thought to be the first in the UK to ban credit card customers from borrowing to<br />

buy Bitcoin.<br />

The ban applies to Lloyds Bank, Bank of Scotland, Halifax and MBNA customers, starting<br />

from Monday.<br />

The decision follows a sharp fall in the value of Bitcoin with the digital currency ending last<br />

week down 30% to US$8,291.87 amid worries about a clampdown on cryptocurrencies by<br />

regulators.<br />

It marked the worst week since April 2013 and was well below the US$19,000 it reached<br />

last November.<br />

Lloyds is worried that it will have to bear the cost if the price continues to fall and leave<br />

people who borrow money to purchase cryptocurrencies with large debts.<br />

"We continually review our products and procedures and this is part of that,” a Lloyds<br />

spokeswoman said.<br />

Economists predict Bitcoin crash<br />

On Friday the Nouriel Roubini , the economist credited with predicting the 2008 financial<br />

crisis, said Bitcoin was the biggest bubble in history and predicted the value of the digital<br />

currency would plummet “all the way down to zero”.<br />

Warren Buffett has also advised investors against cryptocurrencies, saying the Bitcoin boom<br />

will “come to a bad ending”.<br />

Regulatory clampdown<br />

Bitcoin’s slide has followed reports that US regulators are investigating whether the surge in<br />

the price of the cryptocurrency was the result of market manipulation.<br />

Cryptocurrencies have also been hit by South Korea's government saying it plans to ban<br />

trading of digital currencies. China, Russia, India and Germany have also issued warnings.<br />

READ: Bitcoin blow-out continues as South Korea launches cryptocurrency ban<br />

Last week Facebook said it has banned all advertising for cryptocurrencies because they<br />

are “frequently associated with misleading or deceptive promotional practices”. The move<br />

came after the social media network received criticism from users about scams and hoaxes<br />

being promoted in their <strong>news</strong>feed.<br />

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