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CATEGORY: signature bank


Mar 31, 2023 10:30

‘Panic of 2023’: James Corbett Explains How Bank Crisis Could Lead to CBDC ‘Nightmare of Total Monetary Control’

Investigative journalist James Corbett has recently referred to the ongoing global banking crisis involving SVB, Signature Bank, Credit Suisse and others as the “Panic of 2023,” drawing comparisons to what he views as historical precedents, and pointing ahead to an inevitable and bleak, technocratic surveillance future leveraging central bank digital currencies (CBDCs) should nothing be [...]

The post ‘Panic of 2023’: James Corbett Explains How Bank Crisis Could Lead to CBDC ‘Nightmare of Total Monetary Control’ appeared first on Crypto Breaking News.

Apr 30, 2023 02:15

US Bank Failures Shock Regulators


The New York Department of Financial Services and the US Federal Reserve Board have published their internal reviews on the handling of Signature Bank and Silicon Valley Bank's failures. The string of bank failures, including Silvergate Bank's voluntary liquidation, has prompted regulators to re-evaluate their supervision. (Read More)

Mar 30, 2023 05:05

Amid the Failures, Who Is Providing Banking Services to Crypto?

<p>The banking industry is facing instability, and in the US, problems became clearly visible when three crypto-friendly banks ran into trouble earlier this month. These entities are the now well-known Silvergate Bank, Silicon Valley Bank, and Signature Bank.</p><p> Signature has since been taken over by Flagstar Bank, and this week, news came in that Silicon Valley Bank had been purchased by First Citizens Bank, with the new owners stating there was a structure “to purchase all of the assets and liabilities,” as part of “a whole bank purchase.”</p><p> These continuing events have caused a flurry of speculative claims and counter-claims. Some advocates for the crypto industry assert that a clandestine operation is in process, dubbed Operation Choke Point 2.0, to shut down crypto in the US by cutting off links with conventional banking services.</p><p> Others have replied that such claims lack substance and that the banks in question were riddled with problems of their own making, some of which were related to crypto (and <a href="https://www.financemagnates.com/cryptocurrency/ftx-the-rise-the-fall-and-the-reaction/" target="_blank" rel="follow">notorious entities such as FTX</a>) and some of which were more standard financial problems, but none of which are evidence of conspiracy.</p><p> Whichever side of the debate is closer to the truth, the most immediate practical questions are around how crypto companies in the US can now access banking services and what happens next.</p><p>Silvergate: the First Domino</p><p>When Silvergate Bank went out of operation, it was the first domino to fall, and several large crypto entities, including <a href="https://www.financemagnates.com/tag/Paxos/" target="_blank" rel="follow">Paxos</a>, <a href="https://www.financemagnates.com/tag/BitStamp/" target="_blank" rel="follow">BitStamp</a>, and <a href="https://www.financemagnates.com/tag/Coinbase/" target="_blank" rel="follow">Coinbase</a>, abruptly shifted their business elsewhere.</p><p> Coinbase currently <a href="https://help.coinbase.com/en/coinbase/other-topics/legal-policies/how-is-coinbase-insured" target="_blank" rel="nofollow">lists</a> the following as institutions it uses for depositing customer funds:</p><ul><li> Signature Bank</li><li>JP Morgan Chase</li><li>Cross River Bank</li><li>Pathward</li></ul><p> Note that after Signature Bank went into receivership, and Flagstar Bank then bought its deposits and loan portfolios, that deal did not include digital assets.</p><p> A key technical issue for crypto entities following the closure of Silvergate was their sudden inability to utilize the Silvergate Exchange Network (SEN), which was a private network that could facilitate fiat/crypto exchanges around the clock, an operation critical to working with crypto.</p><p> The first solution was to move over to <a href="https://www.financemagnates.com/tag/Signature-Bank/" target="_blank" rel="follow">Signature Bank</a>, which had its similar system called Signet, but it wasn’t long until it was the turn of Signature Bank to hit critical problems, ending up in FDIC receivership.</p><p> As mentioned, a notable characteristic of the Flagstar purchase of Signature is that Signature’s digital operations, including Signet, were not acquired, staying, instead, under the control of the FDIC. Central crypto platform Coinbase then announced that it would no longer support Signet (which was reported as being still operational).</p><p> It’s known that the technology provider Tassat, which developed the Signet system, also provided similar products to regional banks in the US, including Customers Bank, Western Alliance, Byline, and Cogent, and when it comes to this kind of tech, there’s also Cross River Bank, which provides a real-time <a href="https://www.crossriver.com/fintech/payment-rails/real-time" target="_blank" rel="nofollow">payments system</a> incorporating a fiat on/off ramp.</p><p> USDC stablecoin issuer Circle was also forced to stop using Silvergate, and a glance at its <a href="https://www.circle.com/en/transparency" target="_blank" rel="nofollow">reserves information</a> indicates that it has US Treasuries and cash held at The Bank of New York Mellon. Circle's CEO, Jeremy Allaire, stated, when Silvergate ceased operations, that the Bank of New York Mellon was being used for settlements before the next day announcing that Cross River Bank would take over to provide automated settlements.</p><p> It is apparent, then, that banking services, including all-hours networks facilitating fiat/crypto exchanges, are currently available. However, there have also been reports of concerns about the crypto industry’s risk profile and of banks being cautious about being openly crypto-friendly due to concerns about the possible actions and intent of, at times, unpredictable regulatory bodies.</p><p>Investors Not Scared</p><p>Strikingly, it appears that the potential for a greater banking crisis, coupled with what some are describing as regulatory hostility towards crypto, is not scaring away investors. In fact, the opposite may be true.</p><p> Steven Lubka, the Head of Private Clients and Family Offices at Swan Bitcoin, a financial services company that assists clients in acquiring and holding Bitcoin, explained that while these current banking crises have been unfolding, his company has seen “ and CEOs allocating 1-5% of the corporate treasury in case of emergency.”</p><blockquote class="twitter-tweet"><p lang="en" dir="ltr">I run the Private Wealth team for a <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a> company ??I can absolutely 100% guarantee you that we are seeing new clients come in who are buying <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a> specifically to hedge against banking failures This is simply a real thing which is occurring <a href="https://t.co/eNi8cLLK6R">https://t.co/eNi8cLLK6R</a></p>— Steven Lubka (@DzambhalaHODL) <a href="https://twitter.com/DzambhalaHODL/status/1638579316551294980?ref_src=twsrc%5Etfw">March 22, 2023</a></blockquote><p> It should also be noted that within crypto, along with pushback against perceived overreach by regulators, there has also been a pivot towards creating new financial rails that bypass traditional banks altogether.</p><p> Chief Economist at Circle, Gordon Liao, has recently argued the case for decoupling payments and banking, and Coinbase's CEO, Brian Armstrong, has publicly <a href="https://twitter.com/brian_armstrong/status/1635131491796787201?s=20" target="_blank" rel="nofollow">speculated</a> on the idea of Coinbase becoming a neo bank, operating outside existing conventions.</p><p> What can currently be said for sure is that though the situation around crypto companies, banking services, and even the possibility of crypto-oriented <a href="https://www.financemagnates.com/tag/neobanks/" target="_blank" rel="follow">neobanks</a> remains volatile and unresolved, the crypto industry itself remains as active as ever and navigates new routes when required.</p> This article was written by Sam White at www.financemagnates.com.

Mar 30, 2023 10:30

Stablecoin Supply Shift: TUSD Jumps 110% While Others Experience Reductions

Four stablecoins have reduced their supplies this month, while the stablecoin token TrueUSD (TUSD) has seen its supply jump 110% higher over the last 30 days. TUSD resides natively on four different blockchains. The number of Ethereum-based TUSD rose 27%, while the number of Tron-based TUSD stablecoins increased by 218%. TUSD Supply Swells, Tron-Issued Stablecoins [...]

The post Stablecoin Supply Shift: TUSD Jumps 110% While Others Experience Reductions appeared first on Crypto Breaking News.

Mar 30, 2023 02:10

While Biden and Trump Blame Each Other for Bank Failures, Others Believe the Cause Might Be a Management Issue

The recent banking failures involving the fall of Silicon Valley Bank (SVB), Signature Bank, and Silvergate Bank, have high-profile government individuals trying to find a culprit. U.S. President Joe Biden and former President Donald Trump have publicly blamed each other’s policies for the outcome, but according to some analysts, the problem might be ignorance in [...]

The post While Biden and Trump Blame Each Other for Bank Failures, Others Believe the Cause Might Be a Management Issue appeared first on Crypto Breaking News.

Apr 29, 2023 10:30

Reports by Fed and FDIC Reveal Vulnerabilities Behind 2 Major US Bank Failures

On Friday, Michael Barr, the vice chair for supervision at the U.S. Federal Reserve, published a report on the vulnerabilities that led to the ultimate failure of Silicon Valley Bank (SVB). In addition, Marshall Gentry, the chief risk officer of the Federal Deposit Insurance Corporation (FDIC), released a similar report on Signature Bank’s collapse and [...]

The post Reports by Fed and FDIC Reveal Vulnerabilities Behind 2 Major US Bank Failures appeared first on Crypto Breaking News.

FDIC plans to return $4B in Signature crypto deposits 'by early next week' — Martin Gruenberg

Author: Cointelegraph By Turner Wright
United States
Mar 30, 2023 12:00

FDIC plans to return $4B in Signature crypto deposits 'by early next week' — Martin Gruenberg

The Treasury Department's Under Secretary for Domestic Finance Nellie Liang said at the same hearing she didn’t believe crypto “played a direct role” in the failure of the banks.

Mar 29, 2023 10:30

Senate Banking Committee Holds Hearing on Recent Bank Collapses, Calls for Tougher Regulations

On Tuesday, the U.S. Senate Committee on Banking, Housing, and Urban Affairs, also known as the Senate Banking Committee, held a hearing to discuss the recent bank collapses in the United States and the regulatory response. Throughout the testimonies, digital assets and crypto businesses were mentioned. Senate Banking Committee chairman Sherrod Brown claimed on Tuesday [...]

The post Senate Banking Committee Holds Hearing on Recent Bank Collapses, Calls for Tougher Regulations appeared first on Crypto Breaking News.

Mar 29, 2023 12:30

FDIC Urges Crypto Clients to Transfer Signature’s Funds

On Tuesday, United States Federal Deposit Insurance Corporation (U.S. FDIC) reported that the account holders of Signature Bank have to

Mar 29, 2023 08:45

Signature Bank's Crypto Depositors Get April 5 Account Closure Deadline

<p>The Federal Deposit Insurance Corporation (FDIC) has asked cryptocurrency clients of collapsed Signature Bank to close their accounts by April 5 by finding <a href="https://www.financemagnates.com/cryptocurrency/bank-failures-leave-us-crypto-businesses-in-the-cold/" target="_blank" rel="follow">another banking partner</a>. Else, the regulator will close the accounts and mail a check to the registered addresses. </p><p>Signature Bank's Crypto Clients Get a Deadline </p><p>The FIDC's decision on Tuesday came following the acquisition of Signature Bank's deposits and loans by Flagstar Bank, a part of the New York Community Bancorp (NYCB). However, the deal with FIDC did not include the "approximately $4 billion of deposits related to the former Signature Bank's digital banking business." It also excluded Signature Bank's blockchain-based real-time payments platform, Signet, which crypto companies extensively use. </p><p>"Flagstar's bid did not include about $4 billion in deposits related to Signature's digital-asset business," a FIDC spokesperson told the media. "Those are the deposits we are encouraging customers to move before April 5. If they have not by that day, we will mail checks to the address on record." </p><p>Which Bank will Replace Signature Bank? </p><p>Signature Bank was one of the few crypto-friendly lenders with major crypto companies as its customers. Following the bank's collapse earlier this month, several <a href="https://www.financemagnates.com/cryptocurrency/signature-bank-collapse-coinbase-and-paxos-disclose-massive-exposure/" target="_blank" rel="follow">crypto companies disclosed their exposure</a> to it. Crypto exchange Coinbase held a deposit of $240 million with the failed bank, while stablecoin issuer Circle had $250 million. </p><p>Though the US government rescue plan saved these piles of uninsured deposits of crypto companies with Signature Bank, now another tension for them came. In a business environment where traditional banks are already skeptical of cryptocurrencies, it is unclear which <a href="https://www.financemagnates.com/cryptocurrency/kraken-to-move-from-exchange-to-crypto-bank-amid-us-regulatory-dispute/" target="_blank" rel="follow">banks </a>these crypto companies are turning to with the pocket load of money. </p><p>The New York state regulator, the Department of Financial Services, on March 12 shuttered Signature Bank "to protect depositors." As the bank's control came under FIDC receivership, the US regulators devised a bailout plan and created a temporary lender to provide depositors access to their funds. </p><p>According to the regulators, Signature Bank had total assets of about $110.36 billion and total deposits of around $88.59 billion by the end of 2022. Flagstar Bank acquired substantially all of the deposits, and a part of the loans and took over all 40 branches. FIDC now controls $40 billion in Signature Bank's loan and $4 billion in deposits that were not included in the deal.</p><p>Though not clear, Flagstar's decision to exclude Signature Bank's crypto business might be influenced by <a href="https://www.financemagnates.com/institutional-forex/signature-bank-faced-criminal-probe-in-the-us-before-collapse-report/" target="_blank" rel="follow">reports of a criminal probe</a> against the collapsed bank for its ties with crypto.</p> This article was written by Arnab Shome at www.financemagnates.com.

Mar 29, 2023 07:50

Signature’s Crypto Clients Told to Close Accounts as FDIC Ends Business

The FDIC warned that there would be no more crypto offerings from Signiture after the buy out

Continue reading at DailyCoin.

Stablecoins are solution to crypto’s banking problem, exec says

Author: Cointelegraph By Helen Partz
United States
Mar 29, 2023 04:40

Stablecoins are solution to crypto’s banking problem, exec says

Stablecoins are seen as a potential solution to crypto’s banking problem, but some of them are currently not immune to banking issues.

Fed, NYDFS assess their supervisory performance after March’s big bank failures

Author: Cointelegraph By Derek Andersen
United States
Apr 29, 2023 12:00

Fed, NYDFS assess their supervisory performance after March’s big bank failures

Internal reviews of the supervision of Silicon Valley Bank and Signature Bank have been released, showing weaknesses on the part of the banks’ regulators as well as management.

Mar 29, 2023 05:50

Law Firm’s White Paper Claims US Bank Regulators Are Waging a ‘Clandestine Financial War’ Against Crypto Businesses

According to a recent white paper published by four members of the law firm Cooper & Kirk, PLLC, U.S. bank regulators are attempting to “drive crypto businesses out of the financial system.” The paper, titled “Operation Chokepoint 2.0,” claims that after laying the groundwork by labeling lawful businesses as “reputationally risky,” federal bank regulators, with [...]

The post Law Firm’s White Paper Claims US Bank Regulators Are Waging a ‘Clandestine Financial War’ Against Crypto Businesses appeared first on Crypto Breaking News.

Mar 27, 2023 11:10

How Bank Failures in the US Could Impact Philippine Crypto Regulations

With the collapse of US banks, we explore the perspectives of different stakeholders on if this contagion will lead to stricter regulations.

The post How Bank Failures in the US Could Impact Philippine Crypto Regulations appeared first on BitPinas.

Mar 27, 2023 02:10

Why This Economics Professor Thinks Bitcoin Is Worthless

Steve Hanke, a professor of Applied Economics at Johns Hopkins University, is the latest scholar to trash Bitcoin. Bitcoin Has No Fundamental Value, Says Professor In a tweet on March 26, Hanke said Bitcoin is not a currency but a speculative asset whose fundamental value is zero. He appeared to back fiat, including the Japanese [...]

The post Why This Economics Professor Thinks Bitcoin Is Worthless appeared first on Crypto Breaking News.

Traditional banks rely on ‘tiny buffer’: Paris Blockchain Week 2023

Author: Cointelegraph By Helen Partz
United States
Mar 22, 2023 04:40

Traditional banks rely on ‘tiny buffer’: Paris Blockchain Week 2023

Signature Bank is the best place for crypto banking, even if it goes bankrupt, Woorton co-founder Zahreddine Touag believes.

Mar 20, 2023 06:55

Australian Bankers Association cost of living probe shows bank pressure


The Australian Bankers Association (ABA) has launched a cost of living review to determine how the COVID-19 epidemic, global supply chain restrictions, geopolitical tensions, and other factors have raised Australia's already high cost of living. The research will examine Australia's economic policies and ways to cut living costs. (Read More)

US exploring ways to guarantee the country's 18T of bank deposits: Report

Author: Cointelegraph By Brian Quarmby
United States
Mar 21, 2023 08:20

US exploring ways to guarantee the country's 18T of bank deposits: Report

The current deposit insurance cap under the FDIC is $250,000, but recent banking collapses have seen calls to increase that amount.

Yellen defends government intervention to avoid another SVB

Author: Cointelegraph By Savannah Fortis
United States
Mar 21, 2023 04:40

Yellen defends government intervention to avoid another SVB

The U.S. Treasury Secretary Janet Yellen said the federal government would intervene if necessary to protect other small lenders.

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