Signature’s crypto clients told to close their accounts by April 5: Report
Signature Bank’s cryptocurrency clients have been reportedly given until April 5 to take their funds out and find another bank, or have their accounts closed by the federal regulator.
According to reports, a United States Federal Deposit Insurance Corporation (FDIC) spokesperson said on March 28 that the agency was “reaching out to depositors from Signature whose deposits were not included in NYCB’s bid, confirming that these deposits belonged to digital asset clients.
Depositors who have their accounts closed will receive a check to their registered address, so anyone with funds held with Signature but unable to transfer them out should at least ensure their registered address is up-to-date.
Cointelegraph has reached out to the FDIC for confirmation but did not hear back by the time of publication.
While New York Community Bancorp (NYCB) bought most of the deposits and loans held by Signature Bank on March 19, the deal with the FDIC did not include “approximately $4 billion of deposits related to the former Signature Bank’s digital banking business.”
Related: Crypto-friendly banks mismanaged traditional risks, FDIC head tells Senate hearing
Also excluded from the deal was Signature’s payments platform Signet, which is powered by blockchain technology to facilitate real-time payments with no transaction fees or limits. The fate of Signet is still currently uncertain.
New York-based Signature was closed by New York regulators on March 12, amid concern that it was experiencing a bank run and posed a “systemic risk” to the U.S. economy.
Gruenberg: Signature Bank lost 20% of its deposits in a matter of hours on March 10, the day SVB was shut.
Signature had a negative balance at the Fed at the close of business, and “bank management could not provide accurate data regarding the amount of the deficit.” pic.twitter.com/679dNnnrzJ
— Nick Timiraos (@NickTimiraos) March 27, 2023
The FDIC was appointed as the receiver of the bank, which meant that it was tasked with administering the funds and property connected to it.
Banks interested in acquiring the assets of Signature were asked to submit bids to the FDIC by March 17, with the agency reportedly only considering bids from those with an existing bank charter.