Bitcoin has encountered a lot of friction with established banks and financial institutions in the past, as the idea of transacting using a cryptocurrency that is not backed by any asset seemed unviable. However, this notion could change now that Barclays announced that it just became the first major bank accepting bitcoin.
In fact, Barclays is set to be the first bank to accept bitcoin in the US, UK, and Europe. For now, the bank will only begin to accept the cryptocurrency from charities looking to transfer the funds to their bank accounts.
Road to Mainstream Bitcoin Acceptance?
This announcement marks a huge step for bitcoin when it comes to gaining mainstream acceptance. The cryptocurrency has also been struggling to gain traction now that regulators are stepping up their game when it comes to industry oversight, leading some startups to close shop or relocate.
In addition, the acceptance by a well-known bank could mean a lot for bitcoin credibility. A few years back, bitcoin has often been associated with criminal dealings, most notably for its wide use in the now defunct Silk Road underground market place in the Dark Web.
Other financial institutions have been more focused on the underlying technology or public ledger known as the blockchain. Banks such as UBS or Westpac have been exploring the potential applications of this distributed public ledger on their internal operations. Meanwhile, companies like Overstock have experimented with cryptosecurities or methods in which blockchain can be used to transform the trade settlement process.
Currently, Barclays has 75 staff at two of its research labs in London working on accepting bitcoin. The bank isn’t ready to deal with the currency directly, as it would with an exchange. So far, no company names have been disclosed yet, although Stockholm-based startup Safello seems like a possible candidate since Barclays made an investment in it last year.