Signature Bank, soon to be part of Flagstar Bank (a subsidiary of New York Community Bancorp Inc.), has given the boot to deposits by crypto firms.
According to multiple reports, the FDIC has crypto-affiliated accounts to leave by April 5th. After that, the check will be in the mail.
When the sale was approved, Signature held around $4 billion as part of the bank’s digital asset business. These accounts were not part of the sale.
In recent months, public officials have been tightening the regulatory vice on banks doing business with crypto firms. Not telling them they cannot take on digital asset clients but alluding they will garner additional scrutiny if they do so. And who wants that?
So what happens to all of these funds?
The chatter is that money is quickly looking to move, or already has, to Switzerland, a jurisdiction with multiple digital asset banks that are approved to provide the type of services that are becoming rare in the US. Sygnum Bank, based in Switzerland but operating in multiple jurisdictions, is one regulated bank that has reportedly been garnering a heightened level of interest.