{"id":36830,"date":"2023-07-17T13:59:21","date_gmt":"2023-07-17T17:59:21","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/crypto-industry-turns-to-customers-bank-as-preferred-partner-amidst-collapse-of-silvergate-signature\/"},"modified":"2023-07-17T13:59:23","modified_gmt":"2023-07-17T17:59:23","slug":"crypto-industry-turns-to-customers-bank-as-preferred-partner-amidst-collapse-of-silvergate-signature","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=36830","title":{"rendered":"Crypto Industry Turns to Customers Bank as Preferred Partner Amidst Collapse of Silvergate, Signature"},"content":{"rendered":"
\n

The US crypto industry has a new favorite banking partner, a small Pennsylvania-based called Customers Bank.<\/p>\n

According to a Bloomberg article citing sources familiar with the matter, the bank is partnered with hundreds of crypto companies, with a wave of new clients coming in after the collapse of crypto-friendly banks Silvergate Capital and Signature Bank earlier in the year.<\/p>\n

Customers Bank offers a platform that enables 24\/7 payments for its crypto clients called Customers Bank Instant Token (CBIT), similar to Silvergate Capital\u2019s highly popular but now shuttered Silvergate Exchange Network (SEN) payments platform.<\/p>\n

The closures of Signature and Silvergate earlier in the year left little competition for Customers Bank, analysts say.<\/p>\n

\u201cWith Signature and Silvergate basically shutting their doors, these balances had to go somewhere,\u201d Frank Schiraldi, an analyst at Piper Sandler, said.<\/p>\n

Customers Bank \u201creally seems to be the last man standing\u201d.<\/p>\n

As per sources familiar with the matter, staff at Customers Bank were working around the clock earlier this year to onboard new clients amid the exodus from Silvergate and Signature Bank.<\/p>\n

Customers Bank Playing Down Crypto Links as Regulators Tighten Screws on Industry<\/strong><\/h2>\n

Though Customers Bank has partnered with a wave of new crypto firms, it appears reluctant to promote itself as the crypto industry\u2019s number one new banking partner.<\/p>\n

Deposits on its CBIT platform for crypto clients are limited to no more than 15% of it\u2019s the bank\u2019s total balance sheet.<\/p>\n

According to Bloomberg, CBIT deposits were around $2.25 billion at the end of Q1 2023, accounting for around 13% of the bank\u2019s total deposits.<\/p>\n

Meanwhile, the bank recently removed a page on its website promoting its crypto business and management have stopped touting crypto partnerships in earnings calls.<\/p>\n

Bank representatives have said that, of the wave of new deposits the bank attracted after the Silvergate\/Signature bank collapses earlier this year, only a small portion were from new CBIT clients.<\/p>\n

According to the bank\u2019s CEO Sam Sidhu, the biggest drivers of deposits in the last three months have been from the finance, tech and venture capital sectors.<\/p>\n

Customers Bank\u2019s reluctance to openly embrace its increasingly pro-crypto stance is understandable in light of the toxic regulatory atmosphere surrounding the crypto industry at the moment.<\/p>\n

The US Securities and Exchange Commission (SEC) is going after some of the industry\u2019s biggest players, such as Coinbase and Binance, for allegedly operating as unlicensed securities exchanges, amongst other charges.<\/p>\n

And bank industry regulators warned US banks earlier this year about the risks of doing business with the crypto sector.<\/p>\n

\u201cBanking regulators will be looking at how well (Customers Bank) is controlling the risk,\u201d and asking whether \u201cthey have the sophistication and the strong control to understand the risk of a particular crypto business\u201d, former SEC\/Treasury Department enforcer and partner at consulting company Guidehouse Alma Angotti said.<\/p>\n<\/p><\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

The US crypto industry has a new favorite banking partner, a small Pennsylvania-based called Customers Bank. According to a Bloomberg article citing sources familiar with the matter, the bank is partnered with hundreds of crypto companies, with a wave of new clients coming in after the collapse of crypto-friendly banks Silvergate Capital and Signature Bank […]<\/p>\n","protected":false},"author":1,"featured_media":36831,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[243],"tags":[83],"class_list":["post-36830","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto","tag-featured"],"yoast_head":"\nCrypto Industry Turns to Customers Bank as Preferred Partner Amidst Collapse of Silvergate, Signature | iFintechWorld<\/title>\n<meta name=\"description\" content=\"The US crypto industry has a new favorite banking partner, a small Pennsylvania-based called Customers Bank.According to a Bloomberg article citing\" \/>\n<meta name=\"robots\" content=\"index, follow, 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