Is Signature Bank Making the Right Move by Reducing Its Crypto Deposit Exposure?
At a recent conference, executives from Signature Bank (NASDAQ: SBNY) announced that they are planning to wind down a large chunk of the bank's digital asset-associated deposits in the wake of the FTX debacle, which has shaken the entire crypto industry.
Signature Bank is one of the few U.S. banks currently serving crypto exchanges and clients. The bank doesn't hold cryptocurrencies but has developed a real-time payments platform, which is particularly helpful to crypto trading because cryptocurrencies trade around the clock, while much of the U.S. banking system operates on a lag. In return for using the payments platform, which is called Signet, clients bring large sums of non-interest-bearing deposits to the bank, which Signature pays no interest on.
Banking crypto clients turned into an incredibly strong business for Signature in 2021 and helped drive the bank's stock to extraordinary levels last year. Is Signature making the right move by reducing these crypto deposits?
Source Fool.com
