The Superintendent of the New York State Division of Monetary Companies (NYDFS), Adrienne Harris, has refuted allegations that cryptocurrency depositors have been accountable for the collapse of Signature Financial institution.
At a listening to about stablecoins held by the Home Monetary Companies Committee on April 18, Harris said that the liquidity disaster that led to Signature Financial institution’s collapse was not triggered solely by cryptocurrency depositors, however by varied depositors withdrawing their funds from the financial institution, Bloomberg reported.
Harris reiterated her stance on cryptocurrencies through the listening to, dismissing the notion that they have been accountable for the financial institution’s failure and calling it a “misnomer.”
That is consistent with her earlier feedback on the Hyperlinks NYC convention, the place she defended cryptocurrencies and expressed skepticism towards authorities officers who criticized them.
Signature’s crypto shoppers
Superintendent Harris said that solely 20% of depositors at Signature Financial institution have been cryptocurrency shoppers, and 20% of all depositors withdrew their property, which led to the financial institution’s liquidity disaster.
“The outflow of crypto deposits have been in actual proportion to the illustration within the depositor base general.”
Signature Financial institution’s depositors who withdrew their funds and contributed to the financial institution’s liquidity disaster got here from varied sectors, together with the crypto business, meals distributors, fiduciaries, trusts, and legislation companies, in line with Superintendent Harris.
The financial institution had beforehand said plans to cut back providers for the crypto business on account of regulatory stress and challenges inside the digital asset sector. Regulators took management of the financial institution after outflows reached billions of {dollars} throughout a large financial institution run.
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