Coinbase partners with Barclays in UK
In a major break of ranks within UK Lenders, major cryptocurrency exchange, Coinbase, has secured a banking deal with Barclays. This makes Barclays the first among banks in the UK to expresses interest and act on it instead of shunning it.
Coinbase, a San Francisco startup, which is also now part of the top ten exchanges by volume announced on Tuesday that its English counterpart had opened a bank account with the British Bank.
Until now all UK cryptocurrency players were routing their transactions through a bank in Estonia. The Barclay-Coinbase deal aims to simplify the process of deposits and withdrawals for Coinbase’s UK customers.
As regulators are circling closer and closer to exchanges and their practices, this deal gives Coinbase a semblance of legitimacy as this is the first time any major exchange has struck a deal with a leading world bank. With hundreds of exchanges sprouting up everyday to cater for the ever growing demand in the cryptocurrency market, many of them remain unregulated. When this issue was raised, Barclays refused to comment.
Regulatory bodies all over the world are issuing a repeated warning about how decentralization is achieved by a trade-off with security and earlier this month the Japanese government closed down two crypto exchanges with similar reasoning.
With most banks around the world shunning the world of cryptocurrency and denying service to account holders that have links to the cryptocurrency world because the opinion that it is a platform that is mainly used for money laundering and terrorism financing, Barclays’ move to, in some ways, endorse Coinbase is giving, not only the exchange, but also cryptocurrency legitimacy in the UK.
However, there are still many global banks that have policies in place that prohibit dealing with this sector. This move has been called the biggest innovation hamper in the market right now and a lot of people are trying to fight to change these policies as there are just as many legitimate products in the market as there are illegitimate, if not more. HSBC, especially, has a complete ban on doing business with the money services sector.
Coinbase has also secured an e-money license from the Financial Conduct Authority, UK’s market regulators that will further allow it a passport into the European market.
Hitesh Malviya is the Founder of ItsBlockchain. He is one of the most early adopters of blockchain & cryptocurrency enthusiast in India. After being into space for a few years, he started IBC in 2016 to help other early adopters learn about the technology.
Before IBC, Hitesh has founded 4 companies in the cyber security & IT space.