Cryptocurrency

Crypto&#39;s go-to bank Silvergate&#39;s voluntary collapse and government efforts to seize Silicon Valley Bank shook the industry. Depositors will be compensated, but the industry is reeling from the loss of industry-friendly banks. Most large, brand-name banks would not work with a tiny venture fund, tech startup, crypto firm, or exchange. Silvergate, Silicon Valley Bank, and Signature valued these clientele.These three organizations&#39; collapse has affected CoinDesk and OKX&#39;s U.S. exchange OKCoin.“We&#39;re going to struggle with banking for a while,” said Tether co-founder and WAX CEO William Quigley. Tether&#39;s management disappoints Quigley, who left in 2015.As startup clients stopped raising money and started spending, banks had to sell long-dated, government-issued debt at fire-sale prices to maintain liquidity. He thinks this should have been a challenge, not a fatality. “Silicon Valley has seen bizarre phenomena before,” he remarked. Has there ever been a rush of money into a sector, which then goes into [SVB] and burns out as companies make payroll? It&#39;s the system!”Quigley argues management should have seen about June 2022 and sold the portfolio and taken the losses or brought in fresh deposits.Audit committee chairman and bank auditor. &#34;I know the conversation that happens when deposits are going down at an accelerated rate and our investment portfolio is being impaired to the point where we don&#39;t have the money to pay out depositors,&#34; he said.The Fed should have put the bank under a supervisory wind-down in January after management contacted them. He predicts a trust issue. SVB looked excellent because it was regulated by various federal and state agencies, had a clean audit opinion, and was rated investment grade by a federally registered rating organization.“It&#39;s ridiculous to expect depositors to know more than all the regulators and regulated entities that assessed the bank,” he said, adding that the U.S. cannot have a “South American” banking system with little institutional trust and minimal funds in the bank.He said VC and crypto investors favor tiny, non-systemically significant banks since big banks are hesitant to partner with these startups owing to regulatory uncertainties.It&#39;s not impossible.Digital Currency Group (DCG) has been in talks with Santander (SAN), HSBC (HSBA), Deutsche Bank, and United Overseas Bank (UOB) in Singapore, as well as fintechs like Revolout, regarding onboarding its portfolio companies, CoinDesk reported.

Crypto Must Do Better to Be Banked, Say Industry Executives

ItsBitcoinWorld

Altri articoli pubblicati su 15 mar 2023

[Partnership] NEOPIN signs partnership agreement with Agate

On-chain Indicators Scream Bitcoin Bull Market as the BTC Price Roars Back

Leancoin (LEAN) smart contract will be audited by Hacken

What Can You Do With Your Shiba Inu ($SHIB) Tokens?

Xion Global Launches "Xion Pay" - The Polygon Payments Infrastructure for Crypto Payments

The Growing Allure of Decentralized Finance: Understanding Why More People are Turning to DeFi

Iscriviti alla nostra newsletter gratuita per aggiornamenti giornalieri sulle criptovalute!