Signature Bank’s Crypto Policy Reversal Setbacks Cryptocurrency Business Growth

03/13/2023 00:41 • NFT Newsflash • 214 views

According to the report, Frank Chaparo, the chief editor of The Block News, tweeted that the Crypto Friendly Bank Signature Bank was closed, and the crypto capital market basically returned to 2014. Any newly established company had no opportunity to establish a relationship with the bank. In many ways, cryptocurrency has become a formal non-bank business.

Viewpoint: The crypto capital market is basically back to 2014, and startups no longer have the opportunity to cooperate with banks

Analysis based on this information:

The cryptocurrency industry has been dealt a significant blow, according to Frank Chaparo, the chief editor of The Block News. In a tweet, he announced that Signature Bank, a crypto-friendly bank, has stopped providing banking services to companies involved in the cryptocurrency industry. This decision by the bank has sent the crypto capital market back to the year 2014, where it was struggling to get official recognition from banks and financial institutions.

Signature Bank was known for its crypto-friendly stance, and many newly established companies have relied on the banking services it offered. However, with this new policy reversal, such companies are now at a disadvantage. Any new cryptocurrency business that requires banking services will have to find alternative ways to operate, which could potentially lead to their downfall.

Many have interpreted this policy reversal as a final attempt by banks to legitimize cryptocurrency as a formal non-bank business. It is clear that the traditional financial institutions are not keen on recognizing the crypto market as a legitimate business sector. A major reason for this is linked to the lack of regulation in the cryptocurrency market. Banks will not risk their reputation and compliance regulations for a sector that is not tightly regulated.

This decision by Signature Bank has far-reaching implications for the cryptocurrency industry. Without banking services, companies cannot easily acquire credit or provide services to their clients. They cannot engage in international trade and cannot easily transfer funds. This could lead to a lack of innovation and growth in the industry.

In conclusion, the decision by Signature Bank to stop providing banking services to cryptocurrency businesses has dealt a major blow to the industry. It is yet another setback for the market, and it could potentially stifle its growth. Unless cryptocurrency gains wider acceptance and tight regulations are introduced, it seems that it will continue to face challenges from traditional financial institutions.

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