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November 25, 2020

Governance & Guardrails

Discussing exchange deposits and withdrawals in GBP with Bitstamp and BCB Group

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Bitstamp and BCB Group recently announced a partnership for providing exchange deposits and withdrawals in GBP. Both Miha Grcar, head of business development at Bitstamp, and Oliver von Landsberg-Sadie, CEO at BCB Group discussed the venture, saying conversations were going for over a year and they are both excited to get this one off the ground. They also addressed the difficulties surrounding banking relationships for crypto.

(21:59) “Well banking being an issue is an understatement in itself. It was extremely hard to get banking especially in the early days when bitcoin itself was viewed in a very antagonistic fashion by the banks. But I must say that over the years as the industry grew and became more mature, the easier it got. And now I think with a lot of institutional interest as well as more mature regulatory environments, banking is becoming easier. Now when I say easier, this needs to be viewed from a longer time period. It is still not simple, not by far not simple. But it is day and night compared to let’s say early 2014/15,” said Grcar.

Bitstamp is a regulated cryptocurrency exchange, but that doesn’t necessarily mean this dynamic has impacted volumes or customers.

(23:46) “I would say that it impacted the way we are being perceived by the industry as well as the banking partners or more mature new entrants to this space, that’s for sure. It certainly helped establishing banking rails. And today I think Bitstamp is one of the best exchanges in the space. But that still does not mean that you win business simply by being regulated. We are competing against regulated as well as unregulated businesses and products, ease of use, user friendliness, good service, and also reliability and stability is what gets you reputation and business ultimately,” said Grcar.

Von Landsberg-Sadie addressed challenges for GBP processing, saying:

(24:51) “So GBP is a special beast because the expectation among people sending and receiving GBP is that it’s instant. People are used to paying their friends and their friend receiving the money instantly, which is not really the case for EURO and USD. So in an environment where we’re trying to control risks, we have to provide that real-time service while at the same time being able to analyze and monitor those transactions. When you’re processing dollar and euro, there is a small lag, which buys you time to understand, is this transaction legit? You can put it through your ops teams or some kind of AI-based automation to understand those risks. But the biggest challenge in enabling GBP is making sure that you’re still processing all those transactions safely at scale while maintaining that kind of real-time component.”

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Gerelyn Terzo
Gerelyn caught wind of bitcoin in mid-2017 and after learning about the peer-to-peer nature of Satoshi's creation has never looked back. Previously she covered institutional investing and fintech for several major trade publications. Gerelyn resides in Verona, N.J.

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