Crypto exchange and wallet Coinbase will now support the UK Faster Payment system after reportedly opening an account at Barclays.
Crypto exchange service and wallet Coinbase has become the first cryptocurrency exchange to open a UK bank account and gain access to the UK’s Faster Payments Scheme (FPS), according to a blog post by Coinbase CEO Zeeshan Feroz published today, March 14.
While the Coinbase blog post does not name the bank in question, Bloomberg notes that Coinbase reportedly opened an account at UK bank Barclays. The deal between Barclays and Coinbase was helped along by the fact that Coinbase also received an e-money license from the UK’s Financial Conduct Authority this week.
Coinbase, which expanded its services to Europe in 2014, has seen its European market grow “twice as fast as any of [their] other markets in 2017”, with the UK as the company’s “biggest market”, Feroz told Business Insider March 14.
The Fast Payments Scheme is a UK banking initiative aimed at reducing transaction times and is the main infrastructure for money payments currently used in the country. Feroz told Business Insider that supporting the Faster Payments system will allow customers "to see a vastly improved deposit and withdrawal experience."
Coinbase’s access to the FPS means that British customers will no longer have to convert their crypto assets to euros and then to pounds through an Estonian bank, in order to withdraw crypto from Coinbase, which takes a few days and adds on exchange rate charges, according to CNBC.
Feroz wrote in the company’s blog post that the FPS will begin as a pilot for a small number of customers, but it will be rolled out to all UK customers in the “coming weeks”:
“By replacing SEPA [Single Euro Payments Area] for UK customers, Faster Payments will offer a familiar payment experience and is supported by all major UK banks. UK customers will benefit from faster, safer and seamless bank transfers.”
Feroz added in a comment to Business Insider that the pilot will involve only Coinbase’s institutional clients, for although Coinbase’s UK clients are mainly retail clients, the institutional base is “significant:”
"We've got some institutions that use the platform. These could be funds, these could be other regulated businesses that are offering exposure to cryptocurrencies to their customers. We provide liquidity to them. It's actually a very mixed bag with a range of businesses."
Crypto exchanges have had problems all over the world with finding banks that willing to accept them as customers. In December of last year, several large banks in Bulgaria terminated the accounts held by crypto exchanges. More recently, some of the top banks in India have also suspended or terminated crypto exchanges’ bank accounts.