A US Democratic senator claimed that the collapse of Signature Bank is due to the risks the company took with its cryptocurrency business.
A US senator assured that the collapse of SignatureBank is due to the risks that the company took with its business in cryptocurrencies. Thus, in a hearing of the Senate Finance Committee, the Democratic senator michael bennett He assured that Signature did not make “prudently sound” decisions and assured that cryptocurrencies are “like marijuana”.
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“Signature Bank went bankrupt and almost a fifth of its deposits came from cryptocurrencies. They are not allowed to do anything with marijuana, but apparently they can put 20% of this into crypto, a notoriously unstable thing that no one here even understands and where asset values can skyrocket and crash,” Bennet said. The democrat went further and assured that digital currencies They are not even “as stable as the marijuana industry”.
Recently, the Federal Deposit Insurance Corporation of the United States (FDIC, for its acronym in English) asked interested parties to participate in the rescue of some of the bankrupt American banks such as Silicon Valley Bank (SVB) or Signature Bank that do not support any cryptocurrency services.
According to a filing filed with the Securities and Exchange Commission (SEC), Signature had $110.4 billion in total assets and $88.6 billion in total deposits as of December 31, 2022. Its market value is around $4.4 billion.
On the other hand, it has been learned that the United States Department of Justice and the SEC are investigating the bank for possible violation of federal laws such as the lack of measures to prevent money laundering.
Signature was closed by the federal authorities last weekend, considering that it presented a “systemic risk” for the US financial system after the bankruptcy of Silicon Valley Bank.. Days earlier, Silvergate Bank, another major lender to the cryptocurrency sector, filed for bankruptcy.
Source: Ambito
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