According to a fresh report from Coindesk, industry sources have said that Barclays has cut ties with the US crypto exchange Coinbase. The British banking giant has been cooperating with Coinbase since March of 2018.
“Barclays’ risk appetite has contracted”
If true, this would mean that Barclays would no longer be banking for Coinbase. This news will likely come as major news to the crypto community. Barclays is a major financial services and banking actor, and the partnership between the two were seen as further legitimizing Coinbase when it first began.
Moreover, Coinbase’s partnership with Barclays has allowed British users to use Coinbase extensively. Now, this report suggest that the end of the partnership could also potentially end Coindesk users’ access to the UK “Faster Payments Scheme” (FPS).
As such, this could – in extension – dramatically slow the exchange times for British pound sterling to cryptocurrencies, or vice versa. The exact reason as to why the partnership between Coinbase and Barclays has now fallen apart is unclear. However, one source told Coindesk this:
“It is my understanding that Barclays’ risk appetite has contracted a little — 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.”
Barclays will work with Clearbank in the UK
Consequently, it would seem that Barclays is no longer contempt trying their hand at cryptocurrency payments. It is possible that the looming risk of an imminent recession, and macroeconomic warning signs are behind this lower risk appetite.
Cryptocurrencies, on the other hand, are expected to benefit from worsening macroeconomic trends. Nevertheless, Coinbase will reportedly continue to have access to the UK banking sector. This comes through a partnership with Clearbank, which is far younger and less well-known than Barclays.
With that said, however, this is not the first time Coinbase has taken a step back from increasing its crypto involvement. In fact, back in August of 2018, Coinbase began denying reports that it was considering launching a crypto trading desk.
Moreover, two Barclays employees also removed information about working on digital assets for Barclays from their LinkedIn profiles. It remains to see exactly how this development will impact Coinbase. In July of this year, Coinbase announced that it had managed to register eight million new users in the previous year.
Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.