{"id":9635,"date":"2023-05-16T18:26:54","date_gmt":"2023-05-16T22:26:54","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/us-sen-cynthia-lummis-criticizes-signature-bank-executive-for-blaming-crypto-for-its-downfall\/"},"modified":"2023-05-16T18:26:55","modified_gmt":"2023-05-16T22:26:55","slug":"us-sen-cynthia-lummis-criticizes-signature-bank-executive-for-blaming-crypto-for-its-downfall","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=9635","title":{"rendered":"US Sen. Cynthia Lummis Criticizes Signature Bank Executive for Blaming Crypto for Its Downfall"},"content":{"rendered":"
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Sen. Cynthia Lummis said she found it disappointing that a former crypto-friendly Signature Bank executive is not taking the blame for the failed bank, while criticizing his wordiness about crypto.\u00a0<\/p>\n

The Wyoming Republican, who has advocated for crypto, questioned Signature Bank\u2019s former Chairman Scott Shay and former President Eric Howell on Tuesday at a Senate Banking Committee hearing.\u00a0<\/p>\n

\u201cIt looks like there has been a lot of deflection of blame onto those particular depositors that deal in digital assets and onto regulators, but you haven\u2019t accepted any blame yourself,\u201d Lummis said.\u00a0<\/p>\n

Signature Bank failed in March \u2014 one of three banks, including Silicon Valley Bank, to fail within days of each other.\u00a0<\/p>\n

Former Silicon Valley Bank CEO Gregory Becker also testified on Tuesday at the hearing.<\/p>\n

The New York Department of Financial Services announced<\/u> on March 12 that it had taken possession of Signature Bank to protect depositors.<\/p>\n

In prepared testimony<\/u>, Shay noted digital assets\u2019 volatility and regulators\u2019 concerns and said the bank then took steps to \u201csignificantly reduce its digital asset deposits.\u201d<\/p>\n

\u201cUnfortunately, a series of truly extraordinary and unprecedented events unfolded quickly,\u201d Shay said. \u201cOn March 7, a bank with strong ties to the digital asset sector announced it was going out of business, and three days later, on March 10, a second bank was seized by regulators. And then, within just a few hours, our depositors withdrew $16 billion from the bank.\u201d<\/p>\n

Lummis noted Shay\u2019s use of digital assets in that testimony on Tuesday,<\/p>\n

Shay said he did not point to digital assets being a particular cause or not.\u00a0<\/p>\n

\u201cYou mentioned in your testimony digital assets 10 times implying that digital assets were a driver of Signature Bank\u2019s collapse,\u201d Lummis said.\u00a0<\/p>\n

Chokepoint 2.0?<\/h2>\n

Some crypto advocates on Twitter have blamed the government for intentionally targeting<\/u> the crypto sector with bank closures.\u00a0<\/p>\n

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NYDFS Superintendent Adrienne Harris pushed back on that sentiment, speaking on Signature Bank at a conference last month.<\/p>\n

\u201cThe idea that the taking possession of Signature was about crypto and this is \u2018Choke Point 2.0\u2019 is really ludicrous,\u201d Harris was quoted as saying at the conference<\/u>.\u00a0<\/p>\n<\/p><\/div>\n