Coinbase has recently partnered up with ClearBank, a lender that started operations in 2017, to resume its real-time fast payments. Users would soon be able to withdraw or deposit in less than a minute according to Zeeshan Feroz, Coinbase’s UK CEO.
This news comes 3 months after Coinbase lost its partnership with Barclays. During the 3 month duration, the transactions were taking a significant amount of time and Coinbase offered other alternatives like PayPal accounts and buying cryptos through credit cards, etc. The difference after the partnership with ClearBank, however, is pretty notable because of the near-instant transaction speeds. ClearBank is a part of Faster Payments, a UK-based service that allows secure and fast mobile, internet, telephone and standing order payments. Being a part of this service, ClearBank would allow fast withdraws and deposits.
The partnership of Coinbase with Barclays was a big step for crypto as one of the top banks of the world, and the partnership suggested an entrance of crypto in conventional financial systems. Naturally, the relationship ending had a similar impact on the crypto world as the prestigious bank withdrew their partnership deal as getting banking partners for a cryptocurrency-related business has been pretty difficult as the history shows. Barclays’ interest in cryptos deteriorated after the end of the partnership. CEO of a UK based crypto company stated regarding 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.
Zeeshan Feroz also stated that due to the underlying risk in crypto and the failure to understand the space is one of the reasons of this gap with banks. He added:
It’s a very nascent industry that is broadly unregulated so the challenge a traditional bank has is crypto doesn’t fit into one of its existing models for other industries. Understanding the crypto space and how you manage the risk requires a significant amount of investment and resources. As we look at the long term, that gap between crypto and traditional banks will be bridged.
Coinbase still managed to get on board with Fast Payment Services once again by partnering up with ClearBank. The partnership not only signals fast and secure payments once again but also prospects for crypto adoption due to the easy access provided by the bank that allows buying digital assets through British pound accounts.
Coinbase has been pretty mobile with its actions recently. For users in the UK, Coinbase has added a number of cryptocurrencies including Basic Attention Token, 0x, Augur, Stellar Lumens, and XRP. Similarly, for the users in the US, Coinbase has opened a reward system where users would be able to gain 1.5% interest on merely holding USDC, a stable coin. This move has also been termed as one which brings conventional banking incentives to crypto. This interesting system, however, is nothing more than a reward system because Coinbase wouldn’t be managing or lending any USDCs that a user owns. Additionally, this reward system doesn’t depend on the amount of USDCs a person owns.