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Danske Bank, based in Copenhagen, Denmark, advised customers not to invest in cryptocurrencies, announced company on its website. The bank, which has branches in Trondheim (Norway) and Vilnius (Lithuania), does not currently authorize cryptocurrency transactions on its website.
Cryptocurrencies are not guaranteed by a central bank; Therefore, the bank claims that they do not have the protection of investors and consumers generally related to traditional currencies and investments.
Secondly, cryptocurrencies have been very volatile, and price formation is not transparent, says the notice. For this reason, investors have a very limited insight into how the market is developing and the factors that determine the price.
Most Important: Lack of Transparency
The bank cites the lack of transparency and regulatory control as the most important reasons not to invest in cryptocurrencies. These factors have made cryptocurrency a target for criminal purposes, such as money laundering and extortion.
Danske Bank states that a financial institution has the obligation to participate in the fight against money laundering and other financial crimes.
At the present time, cryptocurrencies do not provide a sufficient level of transparency to enable the bank to meet its obligations in the fight against money laundering (LBC), says the notice.
Read this excerpt:
For these reasons, it is not possible to trade cryptocurrencies on the trading platforms of the bank. However, the bank is closely monitoring the market and, if the cryptocurrency market becomes more transparent and mature, the bank could reconsider this position.
“We do not want to under any circumstances support the investment environment surrounding cryptocurrencies”, adds the opinion. It eliminated the possibility of buying financial instruments directly related to cryptocurrency prices.
Such instruments may include exchange notes that reflect the price of cryptocurrency, notes the bank. According to him, these securities are characterized by high risk and volatility.
It also reads: Nordea bank forbids employees from owning bitcoins, unions plan legal action
The Bank will accept certain deposits
If a client seeks to deposit funds from investments in cryptocurrency, the bank said that he would treat them in the same way as deposits from other types of investments. The bank may accept the deposit if it complies with current regulations and AML procedures.
Danske Bank does not block the use of its credit card issued by a bank as part of the cryptocurrency trading. But, as with all credit card transactions, clients are advised to comply with existing anti-money laundering procedures and procedures.
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