The problems of three banks – Silvergate Bank, Signature Bank and Silicon Valley Bank (SVB) – have raised concerns among the cryptocurrency community about the future of companies associated with the industry.
Silvergate, Silicon Valley and Signature all shuttered.
Depositors will be made whole, but there’s basically nobody left to bank crypto companies in the US.
— The Wolf Of All Streets (@scottmelker) March 12, 2023
“Depositors will be saved, but there will be virtually no one in the US to serve crypto companies,” wrote The Wolf Of All Streets podcast host Scott Melker.
Coinshares chief strategy officer Meltem Demirors expressed similar concerns. She emphasized that “in just a week, the cryptocurrency in the United States lost all banks.”
and just like that, crypto in america has been unbanked
Silvergate. Silicon Valley Bank. signature.
in one week pic.twitter.com/nWLDxdOAAA
— Meltem Demirors (@Melt_Dem) March 12, 2023
Crypto investor and blogger Lark Davis noted that Signature Bank was “the last big bank” to service digital asset-related companies.
Umm… so they shut down Signature bank…
Wasn’t that like one of the last big banks working with #crypto companies?
— Lark Davis (@TheCryptoLark) March 13, 2023
Against the backdrop of the situation in the US banking sector, Nick Carter, co-founder of Castle Island Ventures, predicted a possible decrease in liquidity in the market. IN CNBC interview he stated that payment systems SEN and Signet have been a key source of fiat for many firms.
Jake Chervinsky, head of digital asset promotion at the Blockchain Association, noted that the closure of financial institutions creates a “huge gap” in the crypto market.
The closures of Silvergate, SVB, and Signature create a huge gap in the market for crypto-friendly banking.
There are many banks that can seize this opportunity without taking on the same risks as these three.
The question is if banking regulators will try to stand in the way.
— Jake Chervinsky (@jchervinsky) March 12, 2023
“There are many banks that can take advantage of this opportunity without taking on the same risks as these three. The question is whether regulators will try to get in their way,” he added.
BlockTower Capital general partner Mike Bucella told CNBC that many in the industry are already moving to Mercury Bank and Axos Bank.
“In the short term, crypto banking for North America will be an ordeal. However, there is a long list of applicant banks that can fill this gap,” he explained.
The head of the Binance cryptocurrency exchange, Changpeng Zhao, also spoke about the situation with banks, but later deleted his tweet. According to the screenshot, he questioned the need to rescue troubled financial institutions – in his opinion, such assistance reduces incentives to manage risks.
Messari CEO Ryan Selkis also raised concerns about the future of the USDC stablecoin.
The entire industry should be fighting like hell to protect and promote USDC from here on out. It’s the last stand for crypto in the US.
— Ryan Selkis 🥷 (@twobitidiot) March 12, 2023
“From now on, the entire industry must fight desperately to protect and promote the USDC. This is the last pillar for cryptocurrencies in the US,” he said.
Peter Schiff, president of Euro Pacific Capital bank, expressed the opinion that Fed was aware of how unstable the economy was, and that the collapse of the SVB would cause a financial crisis.
The #Fed knows the #economy is so fragile that the failure of #SVB would cause a financial crisis. So it’s abandoned #inflation fight and backstopped the banks instead. That proves #Powell was lying about both the strength of the US economy and his resolve to fight inflation.
— Peter Schiff (@Peter Schiff) March 13, 2023
“This proves that [глава ФРС Джером] Powell lied about both the strength of the US economy and his determination to fight inflation,” Schiff said.
Amid the collapse of the SVB, the stablecoin USDC and algorithmic stablecoins DAI and FRAX lost their peg to the US dollar. On March 13, the issuer of USD Coin, the Circle company, assured of solving problems with the banking support of the asset.
Recall that Ripple CEO Brad Garlinghouse pointed to the financial stability of the company, despite the problems of Silicon Valley Bank.
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