Bank of America has come under scrutiny after a Coinbase user claimed that the bank closed his account over Bitcoin transactions. Coinbase CEO Brian Armstrong quickly addressed the issue, asking other users if they have encountered the same problem with Bank of America.
Coinbase’s CEO Raises Concerns Over Account Closures at Bank of America
Bank of America (BOFA) came under scrutiny on Wednesday when Muneeb Ali, co-founder of Stacks, a Bitcoin layer for smart contracts, revealed on Twitter that the bank unexpectedly closed his bank account, which he had been using for 15 years, without giving a reason. He strongly suspects that the closure was due to him using the bank account for bitcoin transactions through Coinbase. “This is a war on bitcoin & crypto,” he tweeted.
Coinbase CEO Brian Armstrong responded to the tweet, asking if other Bank of America customers have encountered similar issues. “If so, not ok,” the Coinbase boss tweeted. He subsequently conducted a Twitter poll, inquiring whether Bank of America had closed the accounts of any other individuals due to their transactions with his crypto exchange. The poll closed with 16,701 votes, 8.9% of which said yes while 19.3% said no.
Many people shared their personal experiences in reply to Armstrong’s poll, with some stating that they hadn’t encountered any issues. However, a notable portion revealed that their accounts had been closed or suspended by the bank following their Bitcoin transactions.
One Twitter user wrote: “BOFA and Chase probably see BTC as an existential threat so they want to shadow ban/block the onramp and offramps to exchanges.” Another wrote: “They’ve never closed my account over Coinbase transactions, but in the past (especially the year leading up to Covid), they would frequently call me, tell me my account activity looked suspicious, and inquire as to what the nature of my business with Coinbase was.” A different user detailed: “Both 5th/3rd Bank and Capital One have rejected deposits or sales with Coinbase. I eventually was able to arrange for ongoing deposits but they do not make it easy. They were ‘protecting’ me.”
This week, the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency (OCC) took action against Bank of America for “illegally charging junk fees, withholding credit card rewards, and opening fake accounts.” The bank is ordered to pay more than $100 million to harmed consumers and $150 million in penalties to the two agencies.
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