The Federal Reserve has announced the closure of another bank. Signature Bank, the largest crypto bank in the United States, has been shut down by the US regulator. And the arguments could not be more direct. After the collapse of the Silicon Valley Bank, there are fears of “systemic risk”.
The Fed promises that “the taxpayer will not assume the losses” and all deposits will be returned in full. The message is that customers who have their money in this bank are protected, but not certain shareholders and unsecured debtors.
The closure of Signature Bank is a severe blow to the banking sector most closely linked to the crypto world. In less than two weeks, the United States has seen how its two largest crypto banks are no longer accessible. First it was Silvergate and now it has been Signature Bank, located in New York.
The Signature Bank case is representative of what the Federal Reserve wants to monitor. 90% of deposits are not insured by the FDIC (Federal Deposit Insurance Corporation) and more than 20% of all capital is crypto.
According to its own financial data at the end of the year, Signature Bank had assets worth about $110 billion, with a bank’s market value of about $4.4 billion.
The crypto bank had more than 1,800 employees. Signature Bank’s fall is considered the third largest in history bank of the United States, only surpassed by that of Silicon Valley Bank and Washington Mutual Bank, during the 2008 crisis.
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