Barclays supports popular cryptocurrency exchange
Major British bank Barclays has backed popular cryptocurrency exchange Coinbase.
The new relationship will make deposits and withdrawals far smoother for UK customers.
The new deal is a refreshing change as traditional financial institutions have been quick to shun the growing crypto industry.
Coinbase is one of the more popular exchanges that bridges the gap between professional and casual investors.
The San Francisco-based start-up confirmed on Tuesday that its UK subsidiary had secured a contract with the British bank.
Currently, customers in the United Kingdom have their transactions processed through an Estonian bank.
Moving funds can take several days, but the new deal aims to simplify the process massively.
Turn the tide
The new partnership with a major British bank is the first of its kind to be announced.
The move comes as regulators have been circling the waters around cryptocurrency exchanges.
As the demand grows, many new exchanges have popped up to cater for digital assets markets.
This boom has caused governments to increase pressure on financial institutions as many new exchanges are unregulated.
In the US, the Securities and Exchange Commission (SEC) is increasing its warnings about cryptocurrencies.
The board claims that exchanges fall under its mandate as many digital assets traded on exchanges act like securities.
Japan temporarily suspended two cryptocurrency exchanges last month.
The Bank of England governor, Mark Carney, responded by saying cryptos should be regulated in the same way as securities trades.
Due to perceived links to criminal activity, many banks have rejected cryptocurrency-related start-ups.
This shunning has forced most European exchanges to seek out banking relationships in countries more welcoming to fintech such as Poland and Gibraltar.
Coinbase’s UK CEO, Zeeshan Feroz said the company already had a stable relationship with a bank in Estonia for European users.
Feroz clarified that the move was to give British customers “a more familiar experience” by working with a UK bank.
Coinbase said they spoke to “tens” of banks before choosing to work with Barclays, according to Mr. Feroz.
In an area that has become vulnerable to hacking and extreme price volatility, the more prominent exchanges now pushing to legitimize the sector.
Perhaps this new Coinbase / Barclays partnership will signal a changing of the tides in relations between the old and the new financial order.