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RBS Will not Extend its Services to Gibraltar-based Blockchain Companies

The announcement came shortly after the DLT regulatory framework was launched.

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The Royal Bank of Scotland (RBS) informed Gibraltar International Bahas nk (GIB) that it will not process transactions for any account belonging to blockchain companies.

Gibraltar Financial Services Commission (GFSC) launched the Distributed Ledger Technology Regulatory framework on January 1st, 2018. It became the first regulator to recognize and allow licenses for blockchain businesses. However, the good news was quickly followed by RBS’s announcement.

RBS has a history of criticizing Bitcoin. Last month, chairman Sir Howard Davies warned that Bitcoin is like a “frothy investment bubble”. He said, “Put up the sign from Dante’s Inferno – ‘Abandon hope all ye who enter here’ – I think that’s probably what’s needed.” He also added that the Bank of England, the US Federal Reserve, the Securities and Exchange Commission (SEC), and the European Central Bank should do the same.

Davies also opposed the idea of launching Bitcoin futures as it would be “a very risky move in reputational terms”. The Deputy Governor of the Royal Bank of England (BoE), Sir Jon Cunliffe, also advised people to “do their homework, and think carefully” when buying cryptocurrencies.

The BoE had announced earlier in December that it might launch its own digital currency in 2018. But the idea was scrapped when the bank realized that such a decision would negatively impact traditional banks and the economy. Moving forward, the BoE will only be ‘researching’ various cryptocurrencies.

CEO of GIB, Derek Sene, informed users that the bank will now look for other British banks to collaborate with, and that strategic decisions like these are “standard practice”. GIB allowed blockchain companies to open their accounts in October, 2017. However, the bank has decided not to deal in cryptocurrencies just yet.

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