In a show of “approval” for Coinbase’s KYC compliance, UK’s Financial Conduct Authority has granted Coinbase an e-money license
Crypto exchange and wallet service Coinbase has received an e-money license from the UK Financial Conduct Authority (FCA), according to a blog post by Coinbase UK CEO Zeeshan Feroz published today, March 14.
Feroz notes that the license only applies to Coinbase’s fiat activities, not its cryptocurrency dealings. The company’s UK CEO told Business Insider that the “way to think about it is that’s all the fiat money that we handle: money in, money out.”
The e-money license applies to the UK as well as 23 countries within the European Union, and means that Coinbase can “issue e-money and provide payment services in the UK.”
Feroz also told Business Insider that receiving the FCA e-money license is an “approval of the compliance and the KYC processes we have today”, adding:
“There’s an element of trust here in a business that is regulated by the FCA.”
Coinbase’s FCA license will most likely not apply to all of the European Union if Britain doesn’t retain passporting rights after Brexit takes place, Business Insider notes, which would reportedly lead Coinbase to open a new office in the EU.
Due to the fact that the European crypto sector reportedly grew “twice as fast as any of [their]other markets in 2017,” with the UK as the company’s “biggest market”, Feroz said that Coinbase places particular importance on its UK business:
“The UK is a huge market for us, Brexit or no Brexit. We’ve got access to a type of talent pool you can’t really get anywhere else besides the UK in Europe. We certainly intend to invest significantly in the UK office and the headquarters here.”
Coinbase has also become the first crypto exchange to open a bank account in the UK, reportedly at Barclays. Their partnership with Barclays has given the crypto exchange and wallet access to the UK’s Faster Payments Scheme (FPS).
Coinbase and its trading platform, Global Digital Asset Exchange (GDAX), had both recently announced the support of Segregated Witness (SegWit), a Bitcoin (BTC) scalability upgrade, to reduce transaction times for their customers. After the addition of Segwit, a bug in the payment gateway system was spotted and fixed after it caused some customers to lose funds from BTC transactions.
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Author: Molly Jane Zuckerman