Why has Citibank banned use of cards to buy cryptocurrencies?
Citibank recently told its customers through an email message that its credit and debit cards can't be used to purchase cryptocurrencies. The caution may be attributed to the recent statement by the finance minister in his Budget speech that the government will take measures to eliminate the use of crypto assets in financing illegitimate activities or from being part of the payment system. In December, the finance ministry had likened virtual currencies to Ponzi schemes. The Reserve Bank of India, too, has issued repeated warnings.
What should you do?
In the light of all these warnings, risk-averse investors should sell their cryptocurrency holdings. Those who have greater risk appetite may hold on to them, but should not add to their holdings.