Signature Bank imposes an April 5th deadline for crypto clients to close their accounts, following its recent receivership. The fate of Signet, Signature Bank’s crypto payment network, remains uncertain as the FDIC stays silent on the matter.
Signature Bank is putting the heat on its cryptocurrency clients with a fast-approaching deadline: accounts must be closed by April 5th. This move comes on the heels of New York Community Bancorp (NYCB) scooping up most of the bank’s deposits and loans after it fell into receivership.
A Banking Whodunit: FDIC Steps in Amidst Shady Dealings
Enter the Federal Deposit Insurance Corporation (FDIC), which took the reins of Signature Bank after the dramatic collapse of Silvergate and SVB. The plot thickens as the decision to take over might have been influenced by a mysterious investigation where bank representatives failed to provide accurate info about the deficit left by SVB’s bankruptcy.
Crypto Buzz: Was Divestment a Requirement?
Rumors spread like wildfire that any company eyeing Signature Bank had to pinky-swear to divest from the crypto industry. The FDIC jumped in to set the record straight, stating that no divestment was mandatory, but they did give a heads-up about the risks tied to cryptocurrencies.
Crypto Clients Get the Cold Shoulder
New York Community Bancorp, through its sidekick Flagstar Bank, snapped up most of Signature Bank’s loans and deposits. But there was a twist: they left out a whopping $4 billion in deposits from crypto clients. These funds, along with Signet (Signature Bank’s crypto payment network), remained in limbo at the FDIC.
Crypto Clients Face the Final Curtain
Hopes for a happy ending were crushed when the FDIC announced the account closure deadline of April 5th for crypto clients. For those left in the lurch without new banking partners, checks will be mailed to their headquarters to cash out later. Meanwhile, the fate of Signet hangs in the balance, with the FDIC staying tight-lipped about its destiny.