In a groundbreaking day, Coinbase has been granted an e-money license by the UK’s Financial Conduct Authority (FCA), which “will extend beyond the UK to 23 countries within the EU.” With the regulator’s approval in hand, Tuesday also saw Coinbase announce a first-of-its-kind (for cryptocurrency exchanges) partnership with the London-based banking giant, Barclays, who are granting them access to the Faster Payment Scheme (FPS), a payments-clearing scheme for electronic sterling payments in the UK.
What the e-money license means for the UK branch of the San Francisco-based Coinbase is that, per their blog post (written by Zeeshan Feroz, Coinbase (UK) CEO), they will be able “to issue e-money and provide payment services in the UK.” Such a license requires Coinbase to adhere to strict requirements enforced by both the FCA and the Payment Services Directive.
By holding an active license, the customers stand as the ultimate beneficiaries, because – as Coinbase explains – the exchange will be far better equipped to “deliver a better [customer] experience through new partnerships and an easier to use product.”
Indeed, Coinbase has already landed one such partnership, having revealed on Tuesday that, courtesy of Barclays, they are the first cryptocurrency exchange to have been granted access to the UK’s Faster Payments Scheme.
Feroz told Business Insider why adding support for the FPS initiative was such a milestone for Coinbase:
There is no other exchange today that has access to domestic banking, UK consumers today have to jump through all sorts of hoops around sending money to European accounts using euros in order to get money in and out.”
Whilst the announcement outlined that Coinbase’s UK customers stand to “benefit from faster, safer and seamless bank transfers,” Feroz revealed that it will first take the form of a pilot initiative; “giving a small number of institutional users access” to FPS. However, “in the coming weeks,” he assured UK customers that Coinbase would begin making it available to them too.
In an effort to capitalize on this newfound competitive advantage, Coinbase also shared their plans to increase their UK-based staff base by eightfold before the end of 2017. Once recruited, the UK branch of Coinbase will house over one hundred employees.
This aggressive recruiting policy is anything but a rash decision for Coinbase. Indeed, the UK has taken a liking to the world-renowned exchange, and is in fact the company’s biggest in the European market, having attracted twice as much capital flow compared to the next-largest country.
Coinbase will also feature in Washington D.C. on Wednesday, as their Chief Legal and Risk Officer, Mike Lempres, is one of four witnesses that will be called upon to present to the Subcommittee on Capital Markets, Securities, and Investment as part of a hearing entitled ‘Examining Cryptocurrencies and ICO Markets’. In an act of transparency, Coinbase have published Lempres’ written testimony for the hearing.
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