Posted inNews

Coinbase pauses support for Signature Bankโ€™s Signet: Report

March 20, 2023No Comments


More than a week after New York regulators shut down cryptocurrency-friendly Signature Bank, Coinbase reportedly stopped supporting the institution's Signet payment platform.

According to a March 20 report From the Wall Street Journal, Coinbase users will not be able to use Signet to send funds outside of banking hours until further notice. The crypto exchange was reportedly looking for another payment network provider and waiting for the outcome of the situation with Signature.

The crypto-friendly bank was the third domino to fall following the failure of Silvergate Bank on March 8 and Silicon Valley Bank on March 10. Although financial regulators they claimed they intervened to "protect the US economy by strengthening public confidence in our banking system," reports have suggested that Signature I had no problems with solvency at the time of its closure on March 12.

The US Federal Deposit Insurance Corporation. announced the deposits and loans of the bank - with the exception of roughly $4 billion in crypto deposits - would be sold to New York Community Bancorp's Flagstar Bank. The government corporation said it planned to provide crypto deposits "directly to customers" with a digital bank account.

Coinbase, Celsius and Paxos all had funds tied to Signature at the time of bank closure. Coinbase said it expected $240 million in corporate assets to be โ€œfully recovered,โ€ Paxos reported $250 million held in bank, and Celsius announced some exposure, but not the exact amount.

Related: Did the FDIC ask Signature buyers to stop all cryptocurrency business?

The Committee on Financial Services of the United States House of Representatives will be holding a hearing to explore the failures of Silicon Valley Bank and Signature Bank on March 29. FDIC Chairman Martin Gruenberg and Fed Vice President of Supervision Michael Barr are expected to testify.