Main navigation

Error message

Warning: Undefined array key 0 in amp_entity_view_alter() (line 156 of modules/contrib/amp/amp.module).
amp_entity_view_alter(Array, Object, Object) (Line: 545)
Drupal\Core\Extension\ModuleHandler->alter('node_view', Array, Object, Object) (Line: 304)
Drupal\Core\Entity\EntityViewBuilder->buildMultiple(Array) (Line: 238)
Drupal\Core\Entity\EntityViewBuilder->build(Array)
call_user_func_array(Array, Array) (Line: 111)
Drupal\Core\Render\Renderer->doTrustedCallback(Array, Array, 'Render #pre_render callbacks must be methods of a class that implements \Drupal\Core\Security\TrustedCallbackInterface or be an anonymous function. The callback was %s. See https://www.drupal.org/node/2966725', 'exception', 'Drupal\Core\Render\Element\RenderCallbackInterface') (Line: 788)
Drupal\Core\Render\Renderer->doCallback('#pre_render', Array, Array) (Line: 377)
Drupal\Core\Render\Renderer->doRender(Array, ) (Line: 204)
Drupal\Core\Render\Renderer->render(Array, ) (Line: 238)
Drupal\Core\Render\MainContent\HtmlRenderer->Drupal\Core\Render\MainContent\{closure}() (Line: 583)
Drupal\Core\Render\Renderer->executeInRenderContext(Object, Object) (Line: 239)
Drupal\Core\Render\MainContent\HtmlRenderer->prepare(Array, Object, Object) (Line: 128)
Drupal\Core\Render\MainContent\HtmlRenderer->renderResponse(Array, Object, Object) (Line: 90)
Drupal\Core\EventSubscriber\MainContentViewSubscriber->onViewRenderArray(Object, 'kernel.view', Object)
call_user_func(Array, Object, 'kernel.view', Object) (Line: 111)
Drupal\Component\EventDispatcher\ContainerAwareEventDispatcher->dispatch(Object, 'kernel.view') (Line: 187)
Symfony\Component\HttpKernel\HttpKernel->handleRaw(Object, 1) (Line: 76)
Symfony\Component\HttpKernel\HttpKernel->handle(Object, 1, 1) (Line: 58)
Drupal\Core\StackMiddleware\Session->handle(Object, 1, 1) (Line: 48)
Drupal\Core\StackMiddleware\KernelPreHandle->handle(Object, 1, 1) (Line: 191)
Drupal\page_cache\StackMiddleware\PageCache->fetch(Object, 1, 1) (Line: 128)
Drupal\page_cache\StackMiddleware\PageCache->lookup(Object, 1, 1) (Line: 82)
Drupal\page_cache\StackMiddleware\PageCache->handle(Object, 1, 1) (Line: 48)
Drupal\Core\StackMiddleware\ReverseProxyMiddleware->handle(Object, 1, 1) (Line: 51)
Drupal\Core\StackMiddleware\NegotiationMiddleware->handle(Object, 1, 1) (Line: 51)
Drupal\Core\StackMiddleware\StackedHttpKernel->handle(Object, 1, 1) (Line: 704)
Drupal\Core\DrupalKernel->handle(Object) (Line: 18)

Those Involved With Cryptocurrency Face Banking Hurdles, But Regulation Could Help

Advertisement
Fri, 9/03/2018 - 22:04
Those Involved With Cryptocurrency Face Banking Hurdles, But Regulation Could Help
Cover image via U.Today
Read U.TODAY on
Google News

What regulation surrounds Bitcoin and other cryptocurrencies is patchy, varies on a jurisdiction-by-jurisdiction basis and leaves more questions than answers. Because of this, companies that service the crypto industry, such as banks, have had to develop their own policies. These are usually not favorable to Bitcoin.

Banking challenges

Bankers have a tough job – they really do. It’s been said that finance is the most heavily regulated industry in the world, and this is undoubtedly true. Because money is necessary to carry on any sort of criminal activity, authorities have put into place anti-money laundering (AML) and know-your-customer (KYC) laws. In theory, AML and KYC should prevent drug dealers, terrorists and even rogue states from being able to finance their operations.

In order to comply with regulations, banks are required to know the source of customers’ funds. This is easy if you own a bakery and just make your daily deposits. It’s a lot more complicated if you run a Bitcoin exchange and regularly deposit customers’ funds, since exchanges don’t usually know the source of those funds. The law doesn’t forbid banks from dealing with crypto exchanges, but because of the difficulty in proving the source of funds and other AML/KYC challenges, many banks simply refuse to service cryptocurrency exchanges as a matter of policy.

Corporate banking woes

This can be particularly challenging for digital currency exchanges and other businesses that deal with funds sourced from cryptocurrencies. One Polish Bitcoin dealer, Prasos Oy, has had five accounts closed by various banks, according to Bloomberg. His business is hanging on by a thread, with only one account at one bank still open. As the crypto markets soared over the last year, Prasos’ transaction numbers increased so much that the company’s banks started noticing – and closing Prasos’ accounts.

Prasos said:

We’ve realized that the growth in international transaction volumes started to disturb the banks. Along the way, we’ve been given very little information by the banks on what we could do to solve the problem.

Mortgage denied

Even individuals find it difficult to deal with banks when it comes to funds sourced from cryptocurrency holdings. The Los Angeles Times reported on a person who was seeking a mortgage and whose down payment funds came from Bitcoin sales. Chase Bank refused to extend him a mortgage because of their unfamiliarity with Bitcoin and an inability to “source” the funds. He eventually went with a smaller mortgage company who was able to get the job done.

Hopes for regulation

Most cryptocurrency enthusiasts are opposed to government regulation. There are those who are philosophically opposed to “the establishment” regulating a peer-to-peer decentralized currency, no matter what. Others fear the government will get involved and muddle everything up, creating mountains of red tape and smothering the nascent crypto movement in the cradle.

While both sides have excellent points, there are ways in which regulation can actually help cryptocurrency. Clear and thorough, but not overly restrictive, regulations can greatly clarify things for banks and other companies that are essential for crypto-based businesses to operate. Banks, in particular, tend to be conservative institutions and prefer to err on the side of caution. Better-defined regulations could, however, make banks more willing to deal with companies and individuals who have ties to digital currency.

Related articles

Advertisement
TopCryptoNewsinYourMailbox
TopCryptoNewsinYourMailbox
Advertisement
Advertisement

Recommended articles

Latest Press Releases

Our social media
There's a lot to see there, too

Popular articles

Advertisement
AD