Two in five UK crypto investors have had a payment blocked or delayed by their bank when trying to buy digital assets, resulting in many going so far as to switch their lender, according to new research from IG.

After polling 2,000 UK adults and 500 crypto investors, the trading platform found that although the general public generally does not support banks blocking crypto transactions, 40% of investors faced delayed payments.

While banks typically cite fraud prevention as the reason for intervening, the data shows the UK public does not support such overreach. When asked, 42% of UK adults said they opposed banks interfering in crypto transactions, compared to just 33% who support such action.

When faced with this roadblock, the most common response from crypto investors is to switch banks entirely, instead using one that allows crypto transactions, with 35% taking this approach.

Added to that, nearly a third (29%) have submitted a formal complaint to their bank, appealing the decision, while others have adjusted the size of their transactions (22%) or given up altogether (10%).

“We’re in a damaging position where millions of people are effectively being locked out of crypto just because of who they bank with,” said Michael Healy, UK managing director at IG.

“This overreach from banks is only possible because there’s still no clear UK regulatory framework in place governing crypto. Until that changes, responsible firms and investors will be penalised. 

“If the government is serious about making the UK a home for crypto innovation, it needs to act. We urgently need the kind of clear, comprehensive rules we’re already seeing in the US and Europe.”

The IG findings come amid growing warnings that the UK is falling behind in the global crypto race, despite a study from the FCA last year finding that 12% of UK adults hold crypto, roughly seven million people.

Former Chancellor George Osborne recently cautioned that the UK risks missing out on the second wave in crypto, pointing directly to the restrictions banks are placing on crypto exchanges as a key reason the UK is losing its competitive edge.

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Although the Labour government have been keen to ‘rewire’ the UK in order to avoid just that scenario, the latest rules surrounding crypto assets laid out by the Treasury were designed with the protection of investors and consumers in mind, meaning more red tape for crypto traders.

Meanwhile, in the US, President Donald Trump is aiming to make America a leader in crypto assets, and this month signed a new executive order targeting the debanking practices of US banks.

While that order did not go as far as specifically mentioning restrictions placed on crypto or digital assets, the order directs regulators to roll back rules that may have prompted banks to cut off customers like crypto traders.