Using Monzo bank to buy crypto

Monzo Bank customers cannot buy cryptocurrencies directly on the banking platform, but they can use the funds in their accounts to make crypto purchases on exchanges.

This is confirmed by the bank itself on its official website, where it specifically writes that Monzo customers can use a range of crypto exchanges to buy cryptocurrencies as part of the banking service offered.

They add, however, that from time to time, as a regulated bank they may block a limited number of transactions based on risk, but this applies to all transactions and not just those involving cryptocurrencies.

Indeed, on another page titled “Is Monzo anti-crypto?” they add that this is not the case at all, because Monzo customers can use a wide range of crypto exchanges, including major ones like Coinbase.

However, they specify that, following the warning issued by the FCA earlier this year, they have stopped payments to Binance for now: this is the only crypto exchange to which they have suspended all payments.

Summary

• Monzo Bank
• Using Monzo Bank to buy crypto
• Bank integration
• Banks and cryptocurrencies

Monzo Bank

Monzo Bank is a British online bank, and was one of the first internet-only banks in the United Kingdom.

Founded in London in 2015, it is in effect a fintech company, and it could hardly be anti-crypto.

It has more than 2,400 employees, and a turnover that exceeds £350 million.

It originally operated only through a mobile app and a prepaid debit card, but starting in 2017 it was able to start offering real bank accounts as well.

Out of a total population of 68 million in the United Kingdom, Monzo Bank has over 7.4 million customers, which is even almost 11 percent of the entire British population. However, it should be mentioned that it also offers its services in the US.

The fact that it turns out to be crypto-friendly is therefore quite important, particularly for the UK crypto market.

Using Monzo Bank to buy crypto

Monzo Bank is mainly used by British users.

Therefore, in order to use an account with this bank to buy cryptocurrencies, it is necessary to open an account on a crypto exchange operating in the UK, excluding Binance.

Once you open an account on a crypto exchange, you will need to deposit pounds into this account, sending them from your Monzo account.

The procedure is not identical for every exchange, so you will need to check exchange by exchange how to proceed.

Basically, however, either you proceed by sending the money via bank transfer, or you make payments on the exchange using the Monzo debit card.

In both cases the purchase of the crypto will be made on the exchange, and in both cases the purchase will be paid with pounds from the bank account.

The difference is that the debit card payment is made at the time of the purchase, and is limited to the payment of the purchase itself, while in the case of the bank transfer the payment is made within the exchange after sending the money from the bank account to you.

You need to check the transaction costs, because there is generally a higher fee on crypto purchases paid by card.

Bank integration

In some parts of the world, however, direct integrations of cryptocurrency buying and selling services within the banking platforms themselves have already begun.

This integration is not yet present on Monzo Bank’s platform, but it cannot be ruled out that it will be added in the future.

As of today this does not seem at all imminent, but in the more or less distant future there will probably be many banks that will also offer in-house cryptocurrency buying and selling services.

The advantage will be that there will be no need to transfer funds to an exchange, and the purchase can be made directly from the bank’s app or web-banking.

For example, at PayPal this is already the case, although the crypto buying and selling service is only present in some countries.

PayPal is not commonly considered a real bank, but the services it offers are in effect banking services.

Then again, Monzo also started as a simple mobile app, and then became a full-fledged bank a few years later. So it is not at all absurd to imagine that it could follow in PayPal’s footsteps, despite being much younger.

Banks and cryptocurrencies

In truth, however, there are still very few truly crypto-friendly banks like Monzo.

Instead, there are still many banks that try to hinder the transfer of money from their accounts to those of crypto exchanges, which is also why it seems likely that sooner or later they will integrate cryptocurrency buying and selling services.

What’s more, a certain type of cryptocurrency, stablecoin, is nothing more than a tokenization of that same fiat money that traditional banks rely on, so from fiat money to its tokenized version, the leap seems to be short.

The problem, however, is that the crypto market is still largely deregulated, and populated by scams and shady individuals that still make it too unserious and unreliable by strict banking standards.

It is no coincidence that even crypto-friendly banks like Monzo for now have decided not to integrate crypto services in-house.

Some have already done so, however, and apparently are also already reaping the benefits. Perhaps what is still holding traditional banks back is mainly the low profitability of crypto services, especially when compared to the risks one has to take by entering this sector.

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