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- From the US to the UK, crypto companies are finding no relief
- Crypto executives seek a shift to other European countries, citing lenient regulations.
Cryptocurrency firms reportedly find their growth tangled in the United Kingdom region. Though crypto companies seek a crypto-friendly environment across the countries, they find themselves off-guard within some of them. The United States leads in cryptocurrency users worldwide, yet the regulatory unclarity and enforcement actions hamper the sector’s growth. Now the burgeoning asset class is finding itself insecure within another prominent country. Unlike regulatory concerns in the US, banking institutions hinder the crypto firm’s activities in the UK.
Bloomberg reported on April 2 that crypto companies and exchanges in the United Kingdom are finding it difficult to deal with banks. Financial institutions are said to restrict transactions.
Bloomberg states that leading banking firms like HSBC, Barclays and Natwest restricted the users’ money to transfer to crypto exchanges.
Crypto Firms’ Dissatisfaction With UK Banks
Executives of several crypto companies reported facing challenges in dealing with British banks. Other than limiting transactions, excessive paperwork, rejection of applications and other bureaucratic hurdles also create issues for the burgeoning asset-class sector.
Despite the fact that cryptocurrencies are a crucial tool for bringing a decentralized finance revolution, ironically, it needs traditional financial institutions for their operations. Crypto operations are largely dependent upon banks, making them stand in a vulnerable position.
The British government anticipates the country as a crypto hub, but the friction with banking institutions might not let the plan’s success come easily. UK Prime Minister Rishi Sunak was also reported to bring an attractive initiative for crypto companies in the country. Yet the banking impediment didn’t let the plan work.
CEO of Coinpass, a London-based crypto exchange, Jeff Hancock, stated that banking restrictions to the crypto exchanges in Britain could lead the country to stay behind in its aspirations to become a crypto hub.
Another London-based crypto passive portfolio company, SavingBlocks, is reportedly facing difficulties in several operations that involve banking. It applied to at least nine banking institutions seeking a corporate account, but as it turned out, seven of them rejected the application.
Founder and CEO of the company, Edouard Danunizeau, cited the instance and raised the issue of the unavailability of many options. He said since the majority of the traditional banks in the region refrain from providing services to crypto firms, the company is likely to shift its operations within other parts of Europe. France was said to be a potential region where it is comparatively easier to seek a crypto license.
British banks’ actions against crypto companies seem not in line with the government’s aspirations towards crypto. However, the European Union has a relatively easier take on cryptocurrencies and crypto regulations. Coinbase international policy Vice President Tom Duff-Gorgdon said that the “banking reaction” in the UK is more critical than in the EU.
Steve Anderson is an Australian crypto enthusiast. He is a specialist in management and trading for over 5 years. Steve has worked as a crypto trader, he loves learning about decentralisation, understanding the true potential of the blockchain.
