Top U.K. financial institution, Barclays has cut ties with popular San Francisco-based cryptocurrency exchange and wallet provider, Coinbase.
An anonymous source told Reuters today, stating that Barclays which has provided financial services for Coinbase since March last year will no longer continue its relationship with the exchange.
At the moment, there is no explanation from both parties as to what could have brought an end to their relationship, but the source commented:
“I’m not sure exactly why or what’s been driving that, maybe there has been some activity they are not happy with. But it’s about Barclays’ comfort level with crypto as a whole.”
Although the exchange has gotten a new financial service provider in ClearBank to fill the void Barclays left, the severed relationship between Barclays and Coinbase would most likely affect the exchange’s customers, Reuters reported.
The news will not go down well with Coinbase’s users, who are used to enjoying exclusive benefits from the relationship Coinbase had with Barclays.
One of the benefits includes using the U.K. Faster Payment Scheme (FPS) feature Barclays offers, which gives Coinbase’s users the access to instantly withdraw and deposit British Pound via the exchange.
At the moment, Coinbase access to the FPS service is experiencing a delay, as users have to wait days for their GBP deposit and withdrawal will to process via the exchange.
However, Coinbase new-found financial service provider, ClearBank is expected to bring back the FPS service by the end of the third quarter.
Getting banks to provide financial services for crypto-related firms have always been a problem in the U.K, which has prompted most cryptocurrency-related firms in the region to look to other countries such as Malta for financial services cover.
The reason behind banks’ refusal to provide financial services for crypto firms in the U.K. can be traced to concerns of cryptocurrencies being used in illegal activities, including money laundering and terrorist funding.
