Customers of the cryptocurrency exchange Coinbase have been informed that the Signet payments service from Signature Bank will be discontinued until further notice.
Brian Armstrong’s Coinbase cryptocurrency exchange has informed its users that Signet, the former’s real-time payment network, will be suspended permanently as a result of the recent closure of Signature Bank.
The usage of Signet for round-the-clock real-time fund deposits and withdrawals will no longer be available to Coinbase customers, according to a Wall Street Journal (WSJ) report.
The biggest bitcoin trading platform in the US is currently looking for a new banking partner. While it lasted, Signet served as a link between the cryptocurrency sector and the conventional banking system, allowing Coinbase’s business clients to carry out real-time payments without limitations on a 24/7/365 basis.
Crypto companies face banking challenges
The federal deposit insurance commission (FDIC) recently sold Signature Bank to Flagstar Bank, whose crypto business was already under investigation by American authorities before it was shut down on March 12.
The rumor has turned out to be genuine, since the bank’s Signet solution is still under the supervision of the watchdog, despite the FDIC’s denials that it forced prospective Signature Bank buyers to divest the lender’s crypto service at any costs.
According to a March 20 article by crypto.news, the FDIC has stated plans to restore all cryptocurrency deposits currently held by Signature Bank to their owners directly, as the latter’s acquisition by Flagstar Bank does not include its digital assets business.
Businesses focused on cryptocurrencies are now looking to form alliances with banking partners abroad as the U.S. banking crisis persists and authorities continue to attribute the failure of traditional banks to bitcoin (BTC) and other cryptocurrencies rather than their own flawed monetary policies and rapid rate increases.
Experts have claimed that there may be an exodus of web3 projects from the country to countries with agreeable regulations sooner rather than later as crypto market participants in the U.S. find it harder and harder to function in the region due to strict policies.
