Former Signature Bank congressman and board member Barney Frank said the New York City Department of Financial Services (DFS) order to terminate all Signature Bank operations was expected as regulators sought to take advantage of Silvergate Bank and Silicon Valley Bank’s troubles. to send a “very strong anti-cryptographic message” to the public.
“I believe that regulators, especially New York State, wanted to send a message that cryptocurrency is toxic,” says the former congressman.
Frank points out that government worries began to surface last week as Signature clients moved their deposits from the New York bank to larger financial institutions such as JPMorgan and Citigroup.
Although withdrawals from Signature slowed significantly by Sunday, the New York State Department of Financial Services (NYDFS), along with the Federal Deposit Insurance Agency (FDIC), placed Signature Bank under external management and fired top managers.
“We became the first bank whose bankruptcy was not caused by fundamental reasons, but was a consequence of the fact that the bank supported digital currencies as a new element of the financial system. If we were allowed to open tomorrow, we could continue full-fledged work, ”signature Bank board member is convinced.
Superintendent of the New York City Department of Financial Services Adrienne Harris refutes Barney Frank’s assumption and insists that the actions of regulators were not an attack on the crypto industry, but became a necessary measure to protect the funds of bank depositors.
In a joint statement, representatives of the US Treasury, the Fed, NYDFS and FDIC justified their actions by saying that Signature Bank posed the same systemic risk to the stability of the US financial system as the collapsed Silicon Valley.
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