After six years of observing the dynamic world of digital finance and payments, I have witnessed firsthand how regulatory hurdles can significantly impact the operations of even the most innovative and widely-used platforms. In the case of Cash App, a trailblazer in the Bitcoin-friendly application sector, its decision to exit the UK market is a stark reminder of this reality.
Six years after its launch, Jack Dorsey made the decision to halt the operations of Cash App, a Bitcoin-compatible service, within the United Kingdom.
Cash App Face Regulatory Hurdles
As a crypto investor, I’d put it this way: Starting September 15, Cash App, the convenient mobile platform for consumer payments including money transfers, will no longer be available in the United Kingdom for its users.
As a researcher studying the development of Cash App, I’ve discovered that the platform’s expansion into new markets has been met with regulatory challenges. Despite being launched in 2013 under the ownership of Jack Dorsey’s Block Inc., it wasn’t until five years later that Cash App made its debut in the UK. This marked a significant milestone, as the United Kingdom became the first international market for this innovative financial service.
Starting in 2022, Block Inc.’s financial platform encountered regulatory hurdles. The Consumer Financial Protection Bureau (CFPB) initiated legal action against the company in a federal court. This was due to an investigation into Cash App’s management of customer complaints and disputes. According to the CFPB, they made numerous requests for documents and data from Block’s legal team. However, despite these repeated requests, Block failed to provide documents addressing six specific questions posed by the CFPB.
In February, NBC reported that US financial authorities were examining Cash App following allegations from whistleblowers claiming insufficient background checks on users.
The disappointing announcement caused a substantial decline in Block’s stock value and encountered certain operational challenges. In response, the company chose to shift its primary attention towards the US market, while putting plans for global expansion, such as in the UK, on hold.
Kraken Custody And Strike BTC Service Launch in the UK
Kraken, a renowned cryptocurrency exchange, has declared plans to expand its Kraken Custody service to the UK and Australia. Eligible investors in these regions will now be able to securely store, manage, and transfer their crypto assets through this platform. Notably, Kraken considers both countries as prime markets for its Custody service, surpassing the offerings of services like Cash App.
Jack Mallers’ Bitcoin payment app, Strike, recently expanded into the UK market. This expansion represents a significant step to increase Bitcoin availability and usage in one of the world’s leading economic powers. As a result, British users can now make free, immediate, and unlimited deposits for Bitcoin purchases directly from their bank accounts.
The departure of Cash App and the arrival of Strike and Kraken Custody illustrate the unique characteristics of distinct businesses within a given marketplace.
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2024-07-18 18:46