The Federal Deposit Insurance Corp (FDIC) announced on Sunday the purchase of Signature Bank by Flagstar Bank, a subsidiary of Bancorp (19). However, the new owners bankrupted $4 billion tied to the cryptocurrency sector.
Last week, Reuters sources reported that giving up these companies was an FDIC requirement for the bank’s takeover. The agency denied the claims the next day.
Therefore, even if the FDIC has not set these terms, US pressure on the cryptocurrency industry may have affected Signature buyers.
Cryptocurrency companies are being ignored by Signature Bank’s new owners
In total, more than $4 billion (R$21 billion) linked to the cryptocurrency industry was omitted from Bancorp’s purchase of Signature Bank. In the text, the FDIC treats these companies as a “digital banking business.”
“Signature Bridge Bank, NA depositors who are not depositors associated with the digital banking business automatically become depositors of the deemed institution.”
“Flagstar Bank’s offer did not include deposits of approximately $4 billion related to the former Signature Bank’s digital banking business”points to the communiqué of the US bureau. “The FDIC will provide these deposits directly to customers whose accounts are linked to the digital banking business.”
That is, clients like Circle, issuer of the stablecoin USD Coin (USDC), will be able to withdraw their billions of dollars tied up in the Signature Bank. However, they will have to look for new banking partners in order to continue working.
As an option, some companies are already leaving the US. For example, stablecoin TUSD has moved more than $1 billion to the Bahamas in recent weeks. Meanwhile, other companies in the industry are looking to big banks like JPMorgan to hold their money. Oddly enough, they are accepted.
US push on cryptocurrencies
Although the US banking crisis triggered a major bullish move in Bitcoin, regulators are still trying to stop the development of this asset class.
While they cannot ban Bitcoin, many point to the US running “Operation Choke Point 2.0”. That is, blocking services that offer the purchase and sale of cryptocurrencies.
The case therefore deserves close monitoring. After all, the US has a huge influence on the price of Bitcoin due to its market size. Another topic that could move cryptocurrencies this week is the Fed meeting, scheduled for this Wednesday (22).
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
