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 <h2 id="strong-farmington-state-bank-to-wind-down-operations-strong"><strong>Farmington State Bank to Wind Down Operations</strong></h2> 
 <p><span style="font-weight: 400">As part of the enforcement action, <a rel="noopener noreferrer nofollow" title="Farmington State Bank" href="https://thebittimes.com/tag/farmington-state-bank.html">Farmington State Bank</a> has been asked to suspend its operations immediately.&nbsp;</span></p>  
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 <p><span style="font-weight: 400">This is a joint enforcement action from the <a rel="noopener noreferrer nofollow" title="Federal Reserve" href="https://thebittimes.com/tag/federal-reserve.html">Federal Reserve</a> Board and the Washington State Department of Financial Institutions. Hence, Farmington is barred from “making dividends or capital distributions, dissipating cash assets and engaging in certain activities” without seeking the permission of its supervisors.</span></p> 
 <p><span style="font-weight: 400">According to the published statement, Farmington which operates under its Moonstone Bank name improperly changed its business plans last year without informing the bank’s supervisor, nor did it receive approval from the appropriate quarters. Instead, the Washington state-based bank adopted a pro-digital assets business plan.&nbsp;</span></p> 
 <p><span style="font-weight: 400">Precisely, <a rel="noopener noreferrer nofollow" title="Farmington State Bank" href="https://thebittimes.com/tag/farmington-state-bank.html">Farmington State Bank</a> collaborated with a third party to launch an IT infrastructure that supports the issuance of stablecoins. Per a statement from the <a rel="noopener noreferrer nofollow" title="Federal Reserve" href="https://thebittimes.com/tag/federal-reserve.html">Federal Reserve</a>, the FTX-linked bank engaged in this venture in exchange for 50% of mint and burn fees on some stablecoins.</span></p>  
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 <p><span style="font-weight: 400">This move was not in sync with the agreement that Farmington signed with the Reserve Bank in 2020 when it commenced operations as a bank holding company. The bank had earlier agreed to keep its distance from digital <a rel="noopener noreferrer nofollow" title="banking" href="https://thebittimes.com/tag/banking.html">banking</a> operations and avoid altering its business plan.</span></p> 
 <h2 id="strong-alameda-research-owns-stake-in-farmington-state-bank-strong"><strong>Alameda Research Owns Stake in Farmington State Bank</strong></h2> 
 <p><span style="font-weight: 400">It is worth noting that the change in business plan happened around the same time when FTX’s sister trading firm Alameda Research acquired an $11.5 million stake in the firm last year. This investment gave Alameda a 10% stake in the institution.</span></p> 
 <p><span style="font-weight: 400">The table turned earlier this year when federal prosecutors seized $50 million from Farmington citing that the </span><span style="font-weight: 400">funds</span><span style="font-weight: 400"> were deposited in the financial institution as part of </span><span style="font-weight: 400">Sam Bankman-Fried</span><span style="font-weight: 400">‘s scheme to defraud customers.&nbsp;</span></p> 
 <p><span style="font-weight: 400">This forced the FTX-linked bank to give up on crypto at the beginning of 2023 and return to its “roots”.</span></p> 
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