The measure taken is in response to activities pursued by crypto-criminals after last year NatWest customers reported £329m in losses.
Crypto investments are often made through exchange platforms. They allow customers to buy, sell or exchange cryptocurrencies for other digital or traditional currencies.
UK’s FCA Compensation scheme doesn’t protect crypto investments, while cryptocurrencies are currently not regulated by the British regulator.
According to NatWest, men over 35 are most at risk from taking part in risky investments. With the cost-of-living crisis eating people’s savings, criminals take advantage by promising high returns in exchange for victims’ money.
Stuart Skinner, head of fraud protection at NatWest, warned people against falling prey to fraudsters’ extortion techniques.
“You should always have sole control of your cryptocurrency wallet and nobody else should have access. If you didn’t set the wallet up yourself or can’t access the money then this is likely to be a scam”, Skinner said.
“We have seen an increase in the number of scams using cryptocurrency exchanges and we are acting to protect our customers”, he continued.
NatWest’s measure comes in the context of crypto investors looking to compensate for any losses incurred in the previous year. The jittery crypto market suffered a significant downturn in 2022, with the fall of FTX exposing weaknesses in the structure of crypto markets.
The shockwaves sent by FTX’s collapse sent shockwaves across the industry. The value of crypto assets tumbled by 70% from their 2021 highs.