New York Regulator Calls Crypto Theories Associated With Signature Bank Closure ‘Ludicrous’

Adrienne A. Harris, the superintendent of New York’s Department of Financial Services, has branded arsenic “ludicrous” the claims that the closure of Signature Bank was related to its crypto business. Harris insisted that the bank’s “high percent of uninsured deposits” and insufficient liquidity were immoderate of the reasons wherefore it was closed.

Signature Bank’s Liquidity Challenges

Head of the New York State’s Department of Financial Services (DFS), Adrienne A. Harris, precocious reiterated the regulator’s stance that the closure of Signature Bank had thing to bash with its crypto banking business. According to Harris, a superintendent with the regulatory body, the determination to adjacent the slope was taken not lone due to the fact that the slope had “a precocious percent of uninsured deposits” but it besides lacked the liquidity to conscionable withdrawal requests.

Speaking astatine a caller lawsuit organized by the blockchain investigation firm, Chainalysis, Harris besides dismissed assertions that her department’s closure of the Signature Bank whitethorn beryllium portion of an elaborate strategy that is aimed astatine strangling the crypto industry.

“The thought that the taking possession of Signature was astir crypto and this is ‘Choke Point 2.0’ is truly ludicrous,” Harris said.

As antecedently reported by Bitcoin.com News, aft DFS announced its determination to unopen down Signature Bank, committee subordinate and erstwhile U.S. lawmaker, Barney Frank, suggested that the DFS determination was motivated by its perceived antagonistic predisposition towards crypto. Frank, who co-sponsored the 2010 Dodd-Frank Act, insisted determination was nary “insolvency based connected the fundamentals.”

Although Frank’s claims were instantly rejected by the DFS, rumours suggesting the regulator’s enactment against Signature Bank is portion of a coordinated onslaught connected the crypto manufacture person swelled. To enactment claims the DFS whitethorn beryllium retired to termination the crypto industry, critics of the regulator’s determination to spot Signature Bank nether receivership constituent to the fiscal institution’s presumption arsenic the go-to slope for crypto companies.

Crypto Industry’s Immature Compliance Programs

However, successful her latest salvo against critics, Harris claimed the crypto industry’s compliance programs inactive deficiency maturity. She explained:

There is inactive a deficiency of maturity astir Bank Secrecy Act-anti-money-laundering [compliance] and cybersecurity. We’re anxious for the time erstwhile those systems mature and standard arsenic the concern broadside does.

Meanwhile, a study successful the Wall Street Journal said the DFS is astir to finalize regulations that springiness it authorization to measure the crypto industry. This according to the study volition alteration the DFS to sync its regularisation of the crypto manufacture with however it assesses the security and banking sectors. Concerning the fees paid by companies for their examinations, the study quotes Harris revealing that specified revenues volition beryllium added to DFS’ resources.

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