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Closed Accounts of Cryptocurrency Exchanges: FNB Denies External Pressure

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Rumours have it that JPMorgan pressured the First National Bank into closing the accounts of cryptocurrency exchanges in South Africa. But, the FNB has strongly denied that external pressure forced its hand.


Cryptocurrencies, Also Popularly Called Digital Coins.


TechCentral reports that JPMorgan wrote Alan Pullinger, the CEO of FNB’s parent company, FirstRand. In the letter, it allegedly asks the banking group to stop doing business with cryptocurrency exchanges.


FNB said on Wednesday that it had given notice to cryptocurrency trading platforms that it would shut their bank accounts.


“FNB can confirm that it has given reasonable notice to terminate its banking services to virtual currency exchanges and intermediaries trading in virtual currency,” it said.


JPMorgan and FNB are known as “correspondent banks” in Banking parlance. This indicates that FNB and JPMorgan also work to settle foreign exchange transactions from their customers.


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TechCentral asked FNB to confirm whether JPMorgan wrote to Pullinger to apply pressure on FirstRand. Also, if FirstRand (and by extension, FNB) buckled to a request so as not to risk its relationship with the US-headquartered bank.


FNB Says ‘No link’ in Decision to close Accounts of Virtual Currency Exchanges

FNB issued a statement saying: “We categorically confirm that there is no link between the bank’s decision to close virtual currency exchanges to any external entity.”


Adding “We further confirm and emphasise that this decision did not involve any consultation with any third party. As previously communicated, FNB considers this to be a prudent course of action following a comprehensive review of the potential risks currently associated with these entities, particularly given that appropriate regulatory frameworks are not yet in place.”


JPMorgan CEO Jamie Dimon mentions bitcoin as a “fraud” In 2017. Saying he’d fire any employee trading in any cryptocurrency. It also blacklisted cryptocurrency start-ups and refused to open accounts for them, according to media reports.


In February, JPMorgan said it is now the “first US bank to create and successfully test a digital coin representing a fiat currency”.


“The JPM Coin is based on blockchain-based technology enabling the instantaneous transfer of payments between institutional clients.”


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