Coinbase, Celsius, and Paxos disclose money in Signature Bank

by Mar 13, 2023CryptoNews0 comments

Numerous cryptocurrency businesses relied on the crypto-friendly Signature Bank, some of which have voluntarily disclosed their exposure to the recently shut-down company. Some cryptocurrency companies with funds allegedly linked to the now-defunct Signature Bank include stablecoin issuer Paxos, cryptocurrency lender Celsius, and exchange Coinbase.

What Happened?

In March, New York regulators closed the crypto-friendly Signature Bank. Together with the Federal Deposit Insurance Corporation (FDIC) of the United States, 12 was established to “protect the U. S. They stated that the bank represented a “systemic risk to the economy. “.

On March 1, cryptocurrency exchange Coinbase tweeted. Twelve that it expected its approximately $240 million in corporate funds at Signature to be fully recovered.

Paxos, a stablecoin issuer and cryptocurrency company, also came forward, tweeting that it had $250 million in deposits at the bank but added that it also had private insurance to cover the balance not covered by the standard FDIC insurance of $250,000 per depositor.

Signature Bank Account Holders

Signature Bank “held some of its funds.” Still, the amount was not disclosed, according to the Celsius Official Committee of Unsecured Creditors. This group advocates for the rights of account holders at the bankrupt cryptocurrency lender Celsius.

 “All depositors will be made whole,” it was further stated. “.

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Because Signature Bank provided services to so many businesses in the cryptocurrency sector, those businesses with no exposure also spoke up to allay concerns about their exposures.

 Mitch Liu and Robbie Ferguson, co-founders of the Web3 game development platform Immutable X and the media-focused blockchain Theta Network, tweeted that their respective companies had no exposure to Signature.

Paolo Ardoino, the chief technology officer of the stablecoin company Tether, also tweeted about Tether’s lack of exposure to Signature Bank.

 The announcement of Signature Bank’s forcible closure coincided with other banking-related announcements made by U. S. regulators.

Conclusion

The Silicon Valley Bank, a bank that focuses on tech startups and had liquidity problems as a result of a bank run that spread contagion to the cryptocurrency industry, experienced depositor protection measures after the Federal Reserve said the FDIC was authorized to take such measures.

 The Fed also unveiled a $25 billion program to guarantee banks have enough liquidity to meet their clients’ needs in uncertain times.

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