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FDIC to Return $4 Billion in Crypto Deposits Connected to Signature Bank by Early April, Says Chair

During a recent hearing of the U.S. House Financial Services Committee, Martin Gruenberg, the head of the Federal Deposit Insurance Corporation (FDIC), announced that approximately $4 billion in deposits related to Signature Bank‘s digital asset banking business will be returned by early April.

Gruenberg made this announcement in response to a question regarding the agency’s reaction to recent bank failures. He further explained that any deposits that were not covered by the deal between Signature Bank and a subsidiary of New York Community Bancorp would be returned to depositors no later than early next week.

It was previously reported that if depositors did not move their funds, the FDIC would close all crypto-related accounts not included in the NYCB agreement by April 5th.

It is important to note that on March 12, the FDIC and New York financial regulators closed the bank, citing risks to the US economy after Silicon Valley Bank and Silvergate Bank failed.

Nellie Liang, undersecretary for domestic finance at the US Treasury Department, stated that she did not believe that crypto “played a direct role” in the bank failures.

During the March 29 hearing, which was the second time Gruenberg, Liang, and Fed Vice Chairman for Supervision Michael Barr had addressed lawmakers following the collapse of three major banks in the United States, Gruenberg stated that Silvergate Bank had not appropriately managed risks that led to its failure.

Though some lawmakers and regulators have seemingly pointed to the banks’ ties to digital asset companies, many have criticized the association as being without merit.

Signature board member Barney Frank has claimed that the bank had no issues with solvency at the time of its closure, and officials wanted to send a “very strong anti-crypto message.”

News Desk

Unlock News Desk, is a group of Blockchain and Crypto enthusiastic young people, working to keep Unlock readers up to date with the industry news. Connect with the team via email: info(@)unlock-bc.com

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