Coinbase UK No Longer Supporting Zcash (ZEC)

August 14, 2019 / by Crypto.IQ

Coinbase has informed its customers in the UK that it will stop supporting (ZEC) starting August 27th.  

The change will only affect UK-based users of Coinbase. Zcash holders have been prompted to either withdraw their ZEC coins or convert them to another available currency. Users who fail to take the prescribed steps will see the Zcash forcibly converted to sterling pounds after the deadline has passed.

Coming without explanation, Coinbase’s sudden announcement prompted concerns in the cryptocurrency community that the privacy-centric coin—which allows users to keep addresses and transaction details private at discretion—is being removed due to concerns it was non-compliant with UK KYC/AML regulations.

The Zcash Foundation and the Electric Coin Company that oversee Zcash development have been taken aback by this event, further reinforcing that the coin is compliant with local KYC/AML regulations.

According to Electric Coin Company the coin is 100% compliant in this area and can still be purchased in the U.K. on other exchanges like CEX.IO and the Gemini platform, which is assuredly following strict regulatory procedures. The company’s statement as follows:

Those affected by Coinbase UK issues: this is limited to Coinbase UK only. UK residents can still buy/ sell Zcash through CEX.IO. No other exchanges in the UK are affected. To pre-empt speculation, we confirm that Zcash is 100 percent compatible with UK regulations and KYC/ AML requirements.

The Zcash Foundation followed up with a statement:

 We have no additional knowledge beyond the public discussion. Of course, our hope is that Coinbase UK will be able to serve Zcash users again soon.

While the Financial Conduct Authority (FCA) has recently proposed initiating a ban on cryptocurrency-based derivative products, this should not influence Zcash’s status within the country.

Coinbase UK has yet to explain the move, but with a subsequent announcement of switching banks from Barclays to ClearBank, it’s likely a part of the cryptocurrency exchange’s efforts to access Faster Payments Scheme (FPS), a UK payments system designed to reduce transfer times.

Nonetheless, Coinbase users in the UK will have to use another platform to trade Zcash (ZEC). The good news is that Zcash is both available in the UK and likely does not face any regulatory risk under current legislation.