The largest Bank in Denmark Danske Bank has warned clients about the risks of investing in cryptocurrencies. Banks with a network of branches in Trondheim, Norway and Vilnius, Lithuania, currently prohibits cryptocurrency transactions with financial instruments of the Bank.
According to the manual, crypto-currencies are not supported by the Central Bank, hence, their investors and users are not sufficiently protected, unlike those associated with traditional currencies and investments.
“Secondly, cryptocurrencies are extremely volatile, and their pricing is opaque. Because of this, investors have a very limited understanding of how the market develops, and what factors contribute to the price”, – stated in the notice of Danske Bank.
The Bank refers to the fact that the lack of transparency and regulatory control has made the cryptocurrency target for criminal purposes such as money laundering and extortion.
Danske Bank argues that a financial institution is required to assist in the fight against money laundering and other financial crimes.
Cryptocurrency does not currently provide an adequate level of transparency for the Bank.
“For these reasons, it is impossible to trade crypto-currencies on the trading floors of the Bank. However, the Bank is closely monitoring the market and if in the future it will become more transparent and Mature, we will reconsider our position”, – stated in the notice.
The Bank has discontinued the ability to purchase financial instruments directly related to the cryptocurrency.
However, if the customer wants to Deposit funds obtained from investments in the cryptocurrency, the Bank said it will consider them as well as deposits associated with other types of investments. The Bank may accept the Deposit if it complies with the applicable rules and procedures of anti-money laundering (AML).
Danske Bank does not block the use of their Bank credit cards in respect of cryptocurrency trading. But, as with all credit card transactions, customers are encouraged to comply with existing antitrust procedures and regulations.