Coinbase, a prominent cryptocurrency exchange, has been releasing a lot of features and announcements lately. They recently talked about their plans about launching their own insurance company, moreover, Coinbase became the official custodian to all of Grayscale’s holdings. They also added new exclusive stats and made them available to all their customers. More recently, Coinbase published a blog post announcing the addition of eight new digital assets to their platform.
The latest news did not officially come through one of Coinbase’s social media pages, but rather by email to their UK-based customers. Anyone using Coinbase in the UK has been given a two-week notice to either convert their ZCash (ZEC) into another digital asset or transfer it to another wallet or exchange. The email clearly stated: “If you don’t convert or send your ZCash by 26th August, we’ll automatically liquidate your ZEC balance into your GBP wallet”.
The underlying reason for the announcement is yet to be revealed by Coinbase. Nonetheless, the company behind ZCash’s development tweeted: “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 affected. To pre-empt speculation, we confirm that Zcash is 100% compatible with UK regulations & KYC/AML requirements”.
One plausible scenario is Coinbase anticipating negative regulatory announcement directly affecting privacy coins and their legitimacy in the United Kingdom. The latter may or may not be the case as privacy coins were, surprisingly, not scrutinised by the FATF in their crypto-asset guidance report.
Image c/o Zcash