- Britannia Bank & Trust has been added by stablecoin issuer Tether to handle dollar transfers.
- Tether has not publicly disclosed the extent of its relationship with the banking firm.
- Crypto establishments have always found it difficult to build and maintain stable relationships with traditional banks.
According to recent reports, the Bahamas-based Britannia Bank & Trust has been added by stablecoin issuer Tether to handle dollar transfers. Britannia Financial Group is an up-and-coming financial services company headquartered in London.
Tether has not publicly disclosed the extent of its relationship with the banking firm nor has it responded when asked about the new development. This has led to widespread rumors about the banking process and the assets stored for the backing of the stablecoin. These speculations are also fueled by the fact that Tether asked clients to send money to the Britannia Bank’s account in the past few months.
Earlier this week, Patrick Tan, general counsel for ChainArgos, a blockchain data analytics firm, stated that the secrecy surrounding Tether’s banking relationships continues to be a major impediment to developing the cryptocurrency industry. This, according to Tan, is deterring regulatory approvals on other matters, and discouraging traditional asset managers with little tolerance for regulatory risk from more active participation in the space.
Tether has always found it difficult to build and maintain relationships with banks in the traditional banking system. Wells Fargo had cut ties with Tether back in 2017. The closed-down Signature Bank also had a tie-up with Tether, whereby clients could send dollars to Tether’s banking partner Capital Union through Signature. Apart from these, major banks are staying clear of Tether.
Back in March, Paolo Ardoino, the CTO of Tether had divulged that its primary banking partners included Bahamian lenders Deltec Bank & Trust Ltd. and Capital Union Bank. Cantor Fitzgerald, he said, is a custodian for Tether’s Treasury bill holdings.
It is no secret that it has been difficult for crypto businesses to find banking partners in the U.S. due to the country’s surveillance of the industry. Following the collapse of numerous well-known cryptocurrency companies, the Federal Reserve announced earlier this month that it is intensifying its examination of banks’ involvement in digital assets, including stablecoin activity.