Bitfinex Partners with HSBC
October 8, 2018 2:53 pm
Larry Cermak is an ex-editor at Diar and head analyst at The Block. He reported on 6th October that Bitfinex, one of the leading exchanges in the world has partnered with HSBC. HSBC is a London-based bank with a valuation of $133 billion.
Cermak said “Bitfinex is not banking with HSBC through a private account of Global Trading Solutions. Very good fit if you ask me. It’s also worth mentioning that all EUR, JPY, and GBP deposits are paused but Bitfinex ‘expects the situation to normalize within a week.”
Bitfinex is one of the oldest cryptocurrency exchanges on the market. It has faced plenty of challenges in the market, especially in countries like Japan, South Korea, and the United States due to the unclear regulations of cryptocurrencies.
One of the most well-known clashes that Bitfinex has faced is with Taiwanese banks. In April 2017, the company had initiated a lawsuit against Wells Fargo, the banking giant from the U.S. The lawsuit for regarding the blocking of deposits into Bitfinex’s bank account which led to a disturbance in running business operations.
“The decision to initiate legal action is because we cannot allow precedents in this industry where clearing houses can disrupt businesses that are by all metrics complying with the rules in place. If we allow them to simply flip a switch and disrupt business, then there becomes a precedent in the bitcoin industry beyond just Bitfinex, so we believe it is the appropriate time to take action.” – Bitfinex.
Bitfinex has relocated its operations from Taiwan to the Caribbean in May 2018. Bloomberg had reported that the cryptocurrency exchange struck a collaboration with Noble Bank to process client transactions. It seemed that everything would sail smoothly from here. However, Noble bank filed for bankruptcy to restructure its ongoing debt in January this year. This left Bitfinex once again without a banking partner.
Ever since its stint with Wells Fargo, HSBC is the first capable banking partner that the company has had. If the deal between the two companies continues for the long-term, it will bring added stability and vote of confidence for the Bitfinex exchange which the company is trying to get for the past four years.
Kasper Rasmussen, Director of Communications, Bitfinex declined to comment on the nature of the partnership with HSBC. He further stated that
“Bitfinex does not, and has never, commented on actual or potential business relationships and this is not subject to change now.”
Notably, Bitfinex has a daily trading volume of $200 million. It is believed that the exchange has partnered with HDFC after strict Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements in place.