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In the latest twist for banks hoping to tap into the burgeoning sector, Barclays has halted work on a cryptocurrency trading project according to two people familiar with the situation.
Barclays Drops Plan for Cryptocurrency Trading Desk
(Source: Financial News London)
U.K. banking giant Barclays has reportedly scrapped its plan to launch a cryptocurrency trading desk. Citing two people familiar with the situation, Financial News London reported that a group of senior Barclays executives has stopped working on the initiative.
No further information about the reasoning behind the halt was given, and the publication reported that neither an official spokesperson for Barclays nor the people reportedly working on the projects have commented on the matter.
According to a September 27 report from Bloomberg, Chris Tyler, head of Barclays Plc’s digital asset project, had left the British bank sometime in September. Tyler was in charge of exploratory work initiated at the beginning of the year on how the bank could get involved in cryptocurrencies.
Tyler worked on the project alongside Marvin Barth, head of FX and emerging markets macro strategy at Barclays. Lee Braine, a senior technologist at the investment bank, and consultant Matthieu Jobbe Duval also worked on the venture, Financial News London reported.
People familiar with the matter said that the four were tasked with exploring whether there was an appetite among Barclays’ clients for it and what IT infrastructure would be required if cryptocurrencies would be introduced as a viable long-term asset.
The U.K. Lender Latest in Line to Explore Cryptocurrencies
Barclays’ crypto trading initiative made it one out of a handful of large banks, including Citigroup and Goldman Sachs, that were exploring business opportunities in digital assets from trading, to derivatives and custody. However, Financial News London reported that Barclays’ chief executive Jes Staley told the bank’s annual general meeting in May that Barclays remained wary of the regulatory and compliance issues surrounding the asset class.
The decision to drop the project will be of interest to Barclays’ U.K. rivals, many of which have been exploring ways to profit from the explosion of interest in cryptocurrencies. However, most of the mainstream financial institutions have kept their interest in crypto private, often issuing contradicting statements and keeping both the public and their investors in the dark.
According to Bloomberg, Goldman Sachs plans on offering clients custody for crypto funds and is currently exploring on how to serve them in the space. The company’s initiative contradicts their Investment Strategy Group report issued in August, where they claimed that crypto assets would not retain value.
Financial News London also reported that JPMorgan transferred Oliver Harris into the newly-created position of head of crypto-strategy in May, while Goldman Sachs said it is looking into opening a desk for trading cryptocurrencies.