FDIC asked Signature purchasers to quit crypto business? 2023

In response to a rumor that any possible acquirer of Signature Bank will be obliged to sell crypto operations as part of a potential rescue plan, a spokeswoman for the Federal Deposit Insurance Corporation (FDIC) of the United States has disputed the rumor.

According to two individuals mentioned in a report that was published by Reuters on March 17, it is required for any buyer of Signature to give up any bitcoin operations at the bank. In spite of this, a representative for the FDIC told Reuters that the organization would not demand divestment of cryptocurrency activity as a condition of any sale.

According to Reuters, the spokeswoman also referred to previous statements made by Martin Gruenberg, the head of the FDIC, in which he stated that the agency is not aiming to prohibit any particular activity that banks engage in.

The deadline for offers to acquire defunct American financial institutions such as Silicon Valley Bank (SVB) and Signature Bank has been extended to March 17 by the regulators of the FDIC.

The article states that the government would only consider proposals from banks that already have a bank charter, giving conventional lenders more of a priority than private equity groups. This information comes from two persons who are acquainted with the situation. The Federal Deposit Insurance Corporation (FDIC) intends to sell the whole operations of both SVB and Signature, but it will also entertain offers for individual components of the banks if the sales of the full companies do not go through.

Location in New York One of the most prominent crypto-friendly banks in the United States is called Signature. The bank is well-known in the cryptocurrency market for its various collaborations, which include servicing organizations such as the cryptocurrency exchange Coinbase, the stablecoin issuer Paxos Trust, the cryptocurrency custodian BitGo, and the defunct cryptocurrency lender Celsius.

The announcement comes on the heels of a letter being written to the FDIC by Congressman Tom Emmer of the United States House of Representatives, in which he expresses worries that the federal government is “weaponizing” issues surrounding the banking industry in order to go after cryptocurrency.

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About the Author: Sanjh Vishwakarma

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