Report: Barclay's Has Spoken to UK Regulators About Possibly Utilizing Cryptocurrencies

Ashok Vaswani, Barclay’s UK chief executive, tells CNBC that the banking giant is currently talking to fintech firms and regulators about utilizing cryptocurrencies in some capacity.

Vaswani tells CNBC that Barclay’s has had discussions with Britain’s Financial Conduct Authority (FCA) watchdog about “how to make bitcoin safe in response to a question about whether Barclays could support bitcoin.”

“We have been talking to a couple of fintechs and have actually gone with the fintechs to the FCA to talk about how we could bring, the equivalent of bitcoin, not necessarily bitcoin, but cryptocurrencies into play,” Vaswani told CNBC at the Money 20/20 fintech conference in Copenhagen, Denmark.

“Obviously (it’s) a new area, obviously an area we’ve got to be careful with. We are working our way through it.”

Although Vaswani did not elaborate on how Barclay’s might use digital currencies, CNBC notes that last year the bank partnered with Circle, the payments app startup that allows users to send money to each other, including through bitcoin. Circle received a license from the FCA last year.

While the world’s big banks have been hesitant about using bitcoin and other cryptocurrencies – perhaps because it had a slightly nefarious reputation in its early days as being a favored currency of the “dark web” underworld – most major financial institutions are at least looking into utilizing the blockchain technology that supports cryptocurrencies. But it remains to be seen how long it will take for digital currencies to be normalized within the banking world.

Chris Woolard, the FCA’s executive director of strategy, said that there needs to caution from institutions dealing with bitcoin.

“We don’t prohibit regulated firms from engaging in digital currency trading, nor do we prohibit banks from offering banking services to deal with currency firms that use [blockchain]. I am not saying that we view digital currencies as an inherently bad thing… but we do have to exercise a degree of caution,” Woolard said at a recent event, according to website Financial News.

While the world’s biggest cryptocurrencies – including bitcoin and ethereum – have hit a rough patch of late, many investors remain bullish on their long-term prospects.

Photo: Getty iStock