British bank HSBC has become more strict with its crypto policy. The bank now prohibits its clients from purchasing the stock of public companies holding Bitcoin in its treasury.
HSBC's new crypto policy
An HSBC customer has shared a message that he had received from the bank on Twitter. The message informed him of a policy change regarding cryptocurrencies, specifically Bitcoin and Ethereum. The bank's new policy applies to products related to or referencing the performance of virtual currencies.
The notice states that HIDC or HSBC Invest Direct will not participate in facilitating, such as buying or exchanging, products related to virtual currencies or products related to or referencing to the virtual currency's performance.
The notice singles out one stock, in particular, is MicroStrategy Inc., a virtual currency product that is currently on HSBC's chopping block. Every customer that has stocks invested on MicroStrategy will receive a message from the bank.
While MicroStrategy does not offer any crypto services, it has been heavily purchasing BTC since Oct. 2020. The company has amassed almost 100K BTC and has made acquiring cryptocurrency one of its main goals.
The HSBC notice also stated that while the bank permits MicroStrategy Inc to hold and sell or even transfer out of a customer's HSBC Invest Direct account, new purchases or transfers-in will no longer be allowed.
The British bank did not specify how much Bitcoin a company has to hold in order for its stock to be banned from the bank. MicroStrategy Inc. has made it a policy to hold 100% of its treasury reserves in BTC.
A rapidly expanding list of companies has stated that they are investing in Bitcoin but usually in smaller percentages than MicroStrategy.
This includes Tesla, which Elon Musk owns. The car company invested $1.5 billion in January on Bitcoins. Jack Dorsey's Square Inc. put 5% of its total cash reserves in Bitcoin.
The website bitcointreasuries.org curated a growing list of companies with Bitcoin in their treasuries.
One Twitter user comment on the situation, speculating that HSBC Canada is probably arbitrarily deciding what percent Bitcoin reserves is okay for clients to invest in.
The HSBC customer who received the notice from the bank tweeted to MicroStrategy CEO Michael Saylor to ask his legal team if HSBC Canada is legal. Many people are questioning the recent policy change, with some claiming the whole ordeal sounds illegal.
The customer further opined that all of the companies with Bitcoins might be on the chopping block, and the latest policy of HSBC is the opposite of the free market.
MicroStrategy's Bitcoin purchase
MicroStrategy is the first publicly listed corporation to invest in Bitcoin directly. The company first made its Bitcoin purchase in Aug. 2020. After many consecutive investments, it now holds a total of 91,579 Bitcoins that are worth billions of dollars.
The company made its latest Bitcoin purchase earlier this week for $15 million, according to Finance Magnates.
Though numerous companies are now adopting Bitcoins, HSBC's stance towards virtual currency is still negative. The bank earlier banned its customers from transferring profits from Bitcoin trades to their HSBC account.
Related Article : Tesla CEO Elon Musk Not the Richest Man Anymore After Bitcoin Tweet Cost Him $15 Billion Loss
This article is owned by Tech Times
Written by Sieeka Khan
