The leading Cryptocurrency exchange in Bulgaria Crypto.bg was hugely affected by banking clampdown on Cryptocurrency traders who happened in the country last week. The exchange company is now all set to start trading again this week after a week of losses. The company has now announced that everything is back to normal and access to their bank account has been restored. This was after days of negotiations with bank officials.
According to the report tabled by the crypto.bg founder Stamen Gorchev: “Our account was opened on Saturday. We have a lot of ending transactions to approve which are for the periods we have not been operational. We will crosscheck all transactions manually with Kraken. Everyone will have their money on Monday morning, and that’s guaranteed.”
Crypto.bg has now established a working relationship with Fibank which is the bank that is used by most crypto exchange companies in Bulgaria.On Friday they had posted on their website that: “Some of the Big corresponding banks like Commerzbank and JP Morgan Chase are refusing to accept cryptocurrency transactions. Due to that Fibank will not provide the service to Crypto-traders.”
Fibank is owned by Bulgaria. In fact its one of the few banks that are inborn and operate within the country. This bank works till 10pm and opens during weekends where people can purchase Bitcoin. A few years ago the bank almost became bankrupt along another Bulgarian Bank but was bailed out by the government.
After Fibank froze Crypto.bg account Mr. Gorchev saw the freezing as purely business driven. In his statement: “Fibank may not be the problem. The bank and Bitcoin have the very different technology and philosophy. Its expected that when the two collide Bitcoin crashes traditional banking. The problem could be the modern technology.”
Gorchev gave an example of a guy who hacks a foreign account to transfer the amount to a local account. The new account is opened like a charitable account for a homeless person who has no idea about Bitcoin. Then the person gives his ID to another person, and he pays about 100 bucks. After that ‘sponsors’ buy Bitcoin using Euros and transfer to his account. Through such a process money is lost not to be recovered.
Crypto.bg had two options on Saturday on how it could return their funds. One of the options was to refund BGN to their accounts, and the other one was to buy Bitcoin at today’s price.
Clash between Banks and Cryptocurrency
In conclusions, the fight between Banks and Bitcoin is not going to end soon. However, scenarios like collapsing exchange accounts by banks are very harmful to customers. In fact, it can lead to reduced investors since the future between Banks and the Cryptos looks so unpredictable.