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The United States-based crypto advocacy group Blockchain Association has called on financial regulators to provide information related to the potential “de-banking of crypto firms” in the wake of the failures of the Signature, Silicon Valley Bank and Silvergate banks. The Association has submitted Freedom of Information Act requests to the Federal Deposit Insurance Corporation, the board of governors of the Federal Reserve System, and the Office of the Comptroller of the Currency for documents and communications that could potentially show regulators’ actions “improperly contributed” to the collapse of the three banks.



Crypto firms “should be treated like any other law-abiding business” in the United States with access to bank accounts, according to Blockchain Association CEO Kristin Smith. The association is investigating “troubling allegations — including account closures and refusal to open new accounts — which have grown more concerning in the wake of this week’s banking crisis,” said the association, adding, “A crisis that long term crypto opponents have rushed to blame, incorrectly, on the technology.”



The recent banking crisis began with Silvergate’s parent company announcing on March 8 that it would “wind down operations” for the crypto bank. Silicon Valley Bank followed on March 10 with its own failure after a run on deposits, and the Treasury, Fed and FDIC announced the closure of Signature Bank on March 12. At the time, a joint statement from the regulators said the action against Signature was taken to “protect the U.S. economy by strengthening public confidence in our banking system.”



However, former U.S. Representative and Signature board member Barney Frank reportedly claimed the FDIC was sending a “strong anti-crypto message” in shutting down the bank, and some lawmakers are demanding answers. In response to these events, the Blockchain Association is pushing for transparency from regulators on their actions regarding the collapse of these three banks.



Crypto-friendly banks, such as Signature Bank, have been essential to the success of many cryptocurrency firms in the United States, including Coinbase, Paxos Trust, BitGo and Celsius. Prior to its closure, Signature was considered to be one of the largest crypto-friendly banks in the country.



Some in the space have suggested that federal regulators’ perceived attack on banks servicing crypto firms could force companies to turn to “shadier” options. The sudden collapse of these crypto-friendly banks has left many in the crypto industry feeling vulnerable and uncertain about the future of banking for crypto firms in the United States.



The Blockchain Association's call for transparency from regulators on their actions regarding the collapse of these banks is a crucial step towards ensuring fair treatment of crypto firms in the United States. The Association believes that crypto firms deserve access to bank accounts and should be treated like any other law-abiding business in the country.



As the crypto industry continues to grow and mature, it is essential for financial regulators to recognize the importance of crypto-friendly banks and the role they play in the success of crypto firms. By promoting transparency and fair treatment of crypto firms, financial regulators can help foster a healthy and sustainable environment for the industry to thrive.



In conclusion, the recent banking crisis in the United States has raised concerns within the crypto industry regarding the treatment of crypto firms by financial regulators. The Blockchain Association's call for transparency from regulators on their actions regarding the collapse of these banks is a step in the right direction towards ensuring fair treatment of crypto firms. As the crypto industry continues to grow and mature, it is essential for financial regulators to recognize the importance of crypto-friendly banks and the role they play in the success of crypto firms.

#BTC #crypto2023 #bankruptcy #BNB #silvergate

According to the Financial Times, troubled private bank UBS Group AG in Switzerland has made a purchase bid to ailing Credit Suisse Group AG. Previously, it has been confirmed that there will be merger between Credit Suisse and UBS. But, UBS has insisted on an all-share merger with a major adverse change, and it remains to be seen whether #CreditSuisse will accept this offer or not.

Troubled Credit Suisse Group AG Is Offered $1B By UBS Group AG

Bankers believe that a merger between Credit Suisse and UBS, the largest private bank in the world, is the only option to save Credit Suisse and its clients. Concerns about a bank run caused the share price of Credit Suisse to drop by more than 30% in the previous month. Credit Suisse shares were currently trading at $2.01 at the time of publishing.

Silicon Valley Bank (NASDAQ: SIVB) and First Republic (FRC), two US-based banks, have already failed, therefore the US Federal Reserve chose against saving the banks instead of the consumers. Recently, #SVB submitted a chapter 11 #bankruptcy petition.

Is Credit Suisse Going To Accept UBS' Offer?

Although UBS has made an offer, we have not yet heard from Credit Suisse executives. The terms of the transaction include that UBS will buy Credit Suisse for a price of 0.25 Francs per share in UBS stock, according to a Bloomberg quote.

"As per the offer UBS has insisted on a material adverse change that provides UBS authority to walk out of deal anytime if its credit defaults spreads jump by 100 basis points or more."

Also, it should be highlighted that Switzerland regulators are approving this sale without the shareholders' approval because it is an all-shares transaction. This merger is thought to be the last ditch attempt to save the markets after the collapse of Credit Suisse. Officials at Credit Suisse have not yet released a statement, but we might do so before the markets open on Monday.

The #crypto business of #FTX CEO Sam Bankman-Fried had a $6.8 billion deficit on its balance sheet when it filed for #bankruptcy in November 2021, based to a recent filing with the bankruptcy court.

The presentation revealed that FTX.com, the company's flagship, had a $10.6 billion loss while FTX.US had a $87 million one. But FTX Ventures had net assets of $1.3 billion and #AlamedaResearch had net assets of $2.6 billion, respectively, respectively. A total of $11.6 billion in debt, primarily in the form of consumer claims, was owed by the group of businesses.

These statements have not been audited and may change, the advisers have advised. Recent legal and regulatory concerns for Bankman-Fried's firms have included inquiries into alleged market manipulation and unregistered securities offerings. It was believed that FTX was overextending itself because of its activities' rapid expansion, which included sponsoring important sports teams and leagues.

The company's risk management and financial controls are expected to come under scrutiny in light of the announcement of the balance sheet deficiency. FTX is not the only company in the crypto sector experiencing financial issues; in recent years, a number of well-known companies have collapsed or been declared bankrupt. Authorities are growing increasingly worried about the potential threats posed by these enterprises, thus the bankruptcy filing is expected to have a big impact on the #cryptocurrency industry and its regulation. Due to increased industry attention and regulation following the demise of FTX, there may be more restrictions placed on the operations of crypto businesses.

99.99% of people don't understand why recessions happen. Let's start from the absolute basics. In almost all countries around the world, banks take deposits from customers.

When you make a deposit at a bank, the bank offers you interest as an incentive for keeping your money deposited.

The agreement to receive interest allows the bank to lend out a certain portion of your money to other bank customers.

Banks generate profits by lending your money to borrowers at a higher interest rate than what's being offered to you. When you deposit money in your account, the bank adds it to a pool of money from all depositors.

If you want to withdraw money, the bank takes it out of the pool and decreases their liability to you (your bank balance). To PAY interest to depositors, banks use deposits to EARN interest by lending it to customers who want to borrow money.

In other words, banks are an intermediary for people looking to lend savings and other people looking to borrow those savings. While YOU have to work to make money and earn interest on your savings, banks make profits because they can create money out of thin air.

Fractional reserve banking makes it so banks can lend more than the amount of cash they have. Lending creates new money. A mortgage is an example of a loan created through fractional reserve banking.

Let's think of it this way: A bank has $100,000 in deposits. It lends 90% of that money to someone that wants to buy a home. Now there is $190,000 in the system. The money held by depositors is still "available to be withdrawn" - depositor accounts still hold $100,000.

The newly created money expands the economy but also leads to price inflation (because more money is competing for the same amount of goods). This process of borrowing and lending money is the main reason for debt cycles.

A debt cycle begins when we start living beyond our means and spend more than we can afford. A central bank is a national bank that provides banking services to its country's government.

The goal of a central bank is to achieve price stability (low inflation). The main tool they have to achieve their goal is interest rates.

Central banks control debt cycles by increasing and decreasing interest rates for borrowers. These cycles lead to massive booms and busts, and badly impact the average citizen, who may lose their job and their ability to pay for necessities.

#Binance #bank #bankruptcy #SVB #leontech