According to reports, customers of Signature Bank withdrew more than $10 billion in deposits on Friday after being alarmed by the sudden failure of Silicon Valley Bank. As a result, the run on deposits rapidly led to the failure of the third-largest bank in U.S. history. Late on Sunday, regulators announced that they would be seizing control of Signature Bank to safeguard its depositors and the larger U.S. banking system.

A Target Due To Crypto Ties?

According to Barney Frank, a board member and former member of the U.S. House of Representatives, the unexpected action took the officials of Signature Bank by surprise. The New York-based bank which has extensive contracts in the cryptocurrency, real estate, and legal industries is spread over 40 locations, with assets of $110.36 billion, and deposits of $88.59 billion by the end of 2022.

Read More: U.S. President Biden Claims Investors Of Affected Banks Will Not Be Bailed Out

Frank made exceptional claims about the firm’s solvency and alleged that regulators took a targeted approach to show “crypto is toxic”.

I think part of what happened was that regulators wanted to send a very strong anti-crypto message. We became the poster boy because there was no insolvency based on the fundamentals.

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Frank further asserted that the regulators tried closing on them even though there were no justified or compelling reasons. According to him, the regulatory actions appeared as if they had a hidden agenda to show that U.S. banks shouldn’t be involved in anything crypto. Although Frank commended the government’s move to create an “emergency safety net for uninsured deposits”, he argued Signature Bank would have performed better if the government agencies had acted earlier.

The End Of Signature Bank

On Saturday, executives at Signature took a look at all possibilities that would help the company strengthen its position, such as locating additional sources of funding and determining the level of interest shown by potential buyers. According to him, the outflow of deposits had slowed by Sunday, and management believed they had stabilised the situation by that point.

Instead, the bank was abruptly closed on the very same day after its top administrators were dismissed from their positions without explanation. The process of selling the bank is currently being overseen by regulatory authorities, who are assuring customers that their savings will be accessible and that service will be maintained without interruption.

Also Read: Trouble Grows For Silicon Valley Bank As Shareholders File Lawsuit For Fraud

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Pratik has been a crypto evangelist since 2016 & been through almost all that crypto has to offer. Be it the ICO boom, bear markets of 2018, Bitcoin halving to till now – he has seen it all.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.