Portugal bank blocks crypto transfers amid tightening EU rules

Portugal’s BiG Bank blocks transfers to crypto platforms, citing EU compliance, sparking debate over the nation’s shifting stance on digital assets.

Banco de Investimentos Globais (BiG), one of Portugal's major banks, has decided to block fiat transfers to cryptocurrency platforms, citing compliance with European regulations. This move has sparked debates about Portugal's evolving stance on cryptocurrencies, once seen as a haven for crypto enthusiasts. The bank’s decision reflects increasing regulatory scrutiny, aligning with directives from the European Central Bank, the European Banking Authority, and the Bank of Portugal. It also emphasizes adherence to national rules on anti-money laundering and counter-terrorism financing.

While BiG restricts these transfers, other Portuguese banks, such as Caixa Geral de Depósitos, continue to facilitate them. This suggests BiG's decision is not yet a standard across the country. However, this action coincides with Portugal's broader regulatory shift, including a new 28% capital gains tax on short-term crypto holdings, marking a clear departure from its earlier crypto-friendly policies.

The timing of this move is particularly noteworthy, as it follows the recent implementation of the EU's Markets in Crypto-Assets Regulation (MiCA). MiCA aims to provide a unified framework for digital assets across Europe, bringing clarity to the sector. Yet, BiG's decision highlights how interpretations of these regulations can vary, even within a single country.

Critics have expressed concerns about this restrictive approach. José Maria Macedo, a Portuguese crypto entrepreneur, described the move as an abuse of power that will push more individuals toward decentralized finance (DeFi). Similarly, Mario Nawfar noted that this shift comes on the heels of Portugal's new crypto tax laws, further encouraging users to explore DeFi alternatives.

Elsewhere in Europe, the approach to cryptocurrencies remains diverse. In the Czech Republic, the central bank governor has suggested including Bitcoin in the country's foreign exchange reserves as a diversification strategy. France’s banking giant BPCE plans to introduce Bitcoin and other crypto services in 2025 through its subsidiary Hexarq, adhering to MiCA regulations. Germany's Deutsche Bank is tackling blockchain compliance with a Layer-2 solution, and Switzerland continues to stand out with its progressive stance, favoring tokenized assets over central bank digital currencies. Swiss banks have also embraced crypto trading services, with institutions like St. Galler Kantonalbank offering Bitcoin and Ethereum to their clients.

In this context, BiG’s actions contrast with broader European trends, where many banks are expanding into the crypto space under MiCA’s regulatory framework. Despite this divergence, the MiCA framework reassures financial institutions that only compliant crypto platforms can operate within the EU, providing a foundation for trust in the system.

Portugal's evolving crypto landscape reflects a tension between its regulatory ambitions and its previous image as a crypto haven. While BiG’s restrictive policy stands out, it remains to be seen whether other Portuguese banks will follow suit or maintain their more crypto-friendly stance.