Amid the instability in the US banking sector, the United States Federal Deposit Insurance Corporation (FDIC) is reportedly now making a decision against the crypto industry. According to a report published on Wednesday evening, potential buyers of the crypto-friendly Signature bank can now submit offers but with key conditions.
The report said buyers of Signature banks must submit their bids by March 17 and must give up all crypto business at the bank. This has sparked controversy among the crypto community about how US regulators want to disrupt the industry.
Another Major Crackdwon For Crypto?
Signature Bank is one of the US banks that distribute services in the crypto sector closed by state regulators on Sunday. Although the regulators claim that this move has nothing to do with crypto targeting, the community continues to stand by the fact that this is plan for future crypto instability.
Related reading: “Major Scandal” Behind Pro-Crypto Signature Bank Killed By Regulators
Signature Bank has a quarter of deposits for crypto companies and the bank provides financial services to crypto companies, mainly with real-time payment processor Signet, which companies such as USDC issuer Circle use to process transactions after hours.
The bank was recently closed by US regulators and investigated to monitor potential lax which may lead to money laundering. In February, regulators filed a class-action lawsuit against Signature Bank, alleging that the bank knew about and facilitated the FTX fraud.
This move by US regulators has made the crypto community more confident that they know that regulators are never on the side of crypto but always against it.
Many in the industry have now speculated that the closure of Signature Bank and two other crypto-friendly banks Silvergate and Silicon Valley Bank are being used as a weapon to remove crypto businesses from the traditional banking system.
According to US Representative Tom Emmer in a letter sent to the FDIC, the federal government is fighting new instability in the banking sector to attack crypto. Barney Frank, a Signature Bank board member, and a former Democratic congressman noted that the new regulator’s actions are all based on anti-crypto motives.
Frank told CNBC Signature Bank is solvent and regulators are sending a “very strong anti-crypto message.” However, the New York Department of Financial Services (NYDFS) did not return said the decision to shutter Signature Bank was due to a “crisis of confidence” in the bank’s leadership.
Crypto To Keep Moving Regardless
When US regulators move to sell Signature Bank and prevent buyers from continuing to provide services to crypto businesses, they will end the Signature Signet platform’s access to crypto companies, a Coinbase spokesperson said. to Fortune that crypto will still continue regardless.
The spokesperson noted, “As we saw over the weekend, crypto is resilient and we will absorb this and move forward as we have with other events.” He added that there will be “more players to fill that void.”
Meanwhile, the crypto market has continued to maintain calm in the middle of the banking crisis Bitcoin (BTC) and other altcoins are still green after a slight retracement this morning. So far, the global crypto market cap is still worth more than $1 trillion, down just 0.7% in the last 24 hours.
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