Banks and crypto have been a subject of soft contention worldwide, but a recent FCA report has clarified banking services for crypto firms in the UK.
The Financial Conduct Authority (FCA) in the UK has reportedly facilitated discussions between banks and crypto firms. These crypto businesses mainly include those who have struggled to open bank accounts. Banking services for crypto have also been a topic that has seen diverse opinions from all quarters worldwide.
“For cryptoasset businesses and pawnbrokers, we have encouraged and facilitated discussions between the affected businesses and the credit institutions, and between their respective trade bodies. Such dialogue can help ensure a fair and balanced approach is taken, clarify approaches and the reasons behind decisions taken,” says the latest FCA report.
It also mentioned the discussions could help prevent potential risks and mitigate risks. Earlier in 2023, many crypto firms had expressed their difficulties with banks. Some of the major banks in the country had also denied services to crypto firms. Some of these problems could be solved with active intervention by the FCA.
The FCA report has compiled its observations from over 34 payment firms and credit institutions. From the data, it noted banking services for crypto still had some bottlenecks. It mentioned it had taken steps to maintain market integrity in the UK.
Regions like Hong Kong have also seen similar situations. The government in Hong Kong had requested banking institutions to support crypto clients. It is part of a comprehensive pro-crypto strategy adopted by the government in Hong Kong.
Meanwhile, the friction between banks and crypto firms could also arise from the need for more clarity regarding crypto regulation. Europe is far ahead with its Markets in Crypto-Assets Act, while other regions are still under discussions. Even still, the UK government’s crypto-friendly policies have benefitted crypto firms.
European countries like Malta have also tweaked their crypto rules according to MiCA. Other smaller countries in Europe could also see similar changes, with the MiCA gaining broader acceptance. Both businesses and regulators have seen extensive benefits from the crypto regulation.
Meanwhile, the biggest economy in the world, the US, has only seen roadblocks for its crypto firms. The issues have piled up, from regulators locking horns with businesses to lawmakers opposing central bank digital currencies.
Potential presidential candidate Vivek Ramaswamy has openly supported crypto, along with plans to implement a crypto framework. A collective effort from the US could be highly beneficial for crypto, along with multiple benefits from its underlying technology.
The benefits of blockchain technology are prominent, with even businesses like PayPal utilizing it. It recently launched its stablecoin, the PYUSD, on payments firm Venmo. The step could boost stablecoin usage by a huge margin, garnering support for crypto adoption in the US and worldwide.