Coinbase resumes U.K. fast payments after breaking with Barclays
U.S. cryptocurrency exchange Coinbase Inc. has a new banking partner in Britain that will provide real-time payments for customers, three months after losing the service when it broke with Barclays Plc.
The San Francisco-based firm, which lost its Barclays account in July, is now a client of ClearBank, a lender that started operations in 2017, according to a person familiar with the matter who declined to be identified.
Since ClearBank in London is a direct participant in the U.K.’s faster payments system, the crypto exchange can again offer its clients near-instant transfers between their British pound bank accounts and their Coinbase wallets, the person said.
Access to banking is a constant struggle for many crypto businesses: They are routinely refused basic banking services by the likes of HSBC Holdings Plc and JPMorgan Chase & Co. Major lenders are under government pressure to track money flows for signs of illicit activity and have been reluctant to handle funds from firms dealing in the opaque world of cryptocurrencies.
Coinbase’s institutional and retail customers should soon be able to make deposits or withdrawals in less than 60 seconds, said Zeeshan Feroz, the firm’s U.K chief executive officer, who confirmed the existence of the new banking partner without naming it.
In the past three months, transfers have taken considerably longer, sometimes days, with Coinbase offering a raft of alternatives from using PayPal Holdings Inc. accounts to buying digital assets with credit cards. Officials for ClearBank did not respond to requests for comment.
Coinbase’s relationship with Barclays had been notable because it was the first time a top-tier bank had ever taken on a crypto firm as a corporate client. The breakdown, a subject on which neither Coinbase nor Barclays was willing to comment, could be telling of the challenges of integrating crypto with mainstream finance.
“It’s a very nascent industry that is broadly unregulated so the challenge a traditional bank has is crypto doesn’t fit into one of its existing models for other industries,” Feroz said. “Understanding the crypto space and how you manage the risk requires a significant amount of investment and resources. As we look at the long term, that gap between crypto and traditional banks will be bridged.”
Coinbase also doubled the number of cryptocurrencies available to it clients in Britain. Trading will now also be available in Basic Attention Token, 0x, Augur, Stellar Lumens and XRP, Feroz said.