Flagstar Bank has agreed to acquire Signature Bank in a deal that completely excludes cryptocurrency deposits. Yet another stick in the wheels of the crypto industry?
The Federal Deposit Insurance Corporation (FDIC) announced that it has entered into a repurchase agreement with Flagstar Bank. It is a subsidiary of New York Community Bancorp. The deal is about “almost all deposits and some wallets loans” de Signature Bank.
Only downside: the 4 billion dollars deposited by the crypto companies are not part of the deal. However, according to the FDIC, “the funds will be returned directly to the customers”.
What does the FDIC want to do?
Along with deposits from Web3 companies, the deal also excludes Signet, Signature Bank’s infamous payment network. Many crypto businesses, including USDC stablecoin issuer Circle, used the network.
According to Bloomberg, an FDIC spokesperson confirmed that “Signet will remain under the control of the agency and will be subject to further arrangement”.
Reuters also reported that the FDIC “has asked the buyers to desist from all crypto business of Signature Bank.” Information denied by the agency and confirmed by investor Nic Carter. According to himUS lawmakers have reportedly launched a strategy to block crypto companies from accessing banks.
Signature Bank, a victim of US lawmakers?
This Monday, 40 Signature Bank branches reopened under the Flagstar umbrella. In total, the subsidiary of the New York Community Bancorp redeemed $38.4 billion in deposits and $12.9 billion in loans at a discount of $2.7 billion.
However, the agreement also does not include the $60 billion in loans that remain the responsibility of the FDIC. As part of the deal, the agency also received common stock with an estimated value of nearly $300 million.
As a reminder, the Federal Reserve (Fed) closed Signature Bank on March 12 to “protect the American economy”. However, many experts believe that the closure was due to political reasons. Even that the bank would have been perfectly solvent.
Moral of the story: US lawmakers have declared war on crypto, but will they be able to win it?
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