Portuguese Bank BiG Suspends Fiat Transfers to Crypto Amid ECB Directives – What This Means for Investors

Portugal’s Banco de Investimentos Globais (BiG) has suspended fiat transfers to cryptocurrency platforms, citing compliance with European Central Bank (ECB) guidelines on risks associated with virtual assets.

The decision came to attention after an email to customers warned of the bank’s new policy. The move follows increasing regulatory scrutiny of crypto markets in Europe, including push from the European Union for stricter guidelines under the Markets in Crypto Assets (MiCA) framework. However, some experts say the move could backfire by pushing users toward decentralized platforms, outside the control of traditional banks.

Portugal’s Changing Crypto Landscape Amid Regulatory Scrutiny

Despite this change from BiG, other major Portuguese banks, such as Caixa Geral de Depósitos, are reportedly still processing crypto-related transfers. This development could mean a more cautious approach from financial institutions in Portugal, despite the country’s historic pro-crypto stance, such as exempting crypto transactions from VAT and capital gains tax.

Delphi Labs co-founder José Maria Macedo wrote on social media: “One of the largest Portuguese banks, BIG, is now blocking transfers to crypto exchanges, citing ECB guidelines on associated risks to virtual assets. Crypto is inevitable, banks are dead and these abuses of power will only “incentivize” more people to move their wealth on-chain,

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Impact of ECB guidance on crypto adoption in Portugal

This is part of a wider trend, in which stricter regulations are being introduced. Portugal was once considered a tax haven for cryptocurrencies, with no VAT or capital gains tax on cryptocurrencies. But in 2023, it introduced a 28% capital gains tax on short-term crypto holdings.

While some countries, such as El Salvador, have reduced crypto adoption due to economic challenges, Portugal’s evolving stance reflects broader global concerns about the risks associated with digital currencies.