HSBC Bans Microstrategy Stocks Due To Company’s BTC Holdings

HSBC bans Microstrategy stocks because of the large amount of BTC holdings that the company has so let’s read more in our latest Bitcoin news today.

HSBC will not allow trades to invest in Microstrategy stocks because most of the company’s stocks are in Bitcoin. HSBC is one of the largest banks in the world that already blocked transfers from crypto exchanges to client accounts as it took an anti-crypto policy.

The bank confirmed that it will not allow customers to trade Microstrategy stocks because the company has a significant amount of BTC holdings. According to a message sent to a client on the HSBC InvestDirect stock trading platform, the bank explained that they changed the policies on virtual currencies and all other crypto-related products. As a result, the clients can no longer buy or transfers these kinds of assets but they can continue holding or selling them:

“HSBC has no appetite for direct exposure to virtual currencies and limited appetite to facilitate products or securities that derive their value from VCs (virtual currencies).”

HSBC will not let clients buy Microstrategy stock due to their newly changed policy on "virtual currencies". pic.twitter.com/eP1RJIsRE1

— Documenting Bitcoin 📄 (@DocumentingBTC) April 8, 2021

MicroStrategy is a publicly-traded software company that is based in the US with more than 91,000 BTC in its portfolio, comprising 80% of its treasury. This means that the company’s day-to-day fortunes are contingent on the BTC market price. So far, the strategy worked as the company converted its $2.2 billion investment into $5.5 billion with the price of BTC rising to new highs.

However, this seems to not be enough to convince the bank because HSBC bans Microstrategy stock trading. The London-based bank doesn’t take the steps like Morgan Stanley and BNY Mellon that jumped on the BTC trading train as the first one already purchased a 10% stake in Microstrategy a few months ago. Right now, HSBC falls in the “blockchain, not Bitcoin” camp and worked with other banks to run a permissioned blockchain for transactions dubbed Contour.

The timing of the move led to a tricky decision for the bank because it comes closer to the Coinbase direct listing. The shares for the company started trading a few days ago but it is not clear whether the bank regards it as a virtual currency product given the holdings that the company has invested in.