{"id":379960,"date":"2023-03-13T12:29:14","date_gmt":"2023-03-13T12:29:14","guid":{"rendered":"https:\/\/insidebitcoins.com\/?p=379960"},"modified":"2023-03-13T12:32:03","modified_gmt":"2023-03-13T12:32:03","slug":"after-svb-crisis-coinbase-ceo-weighs-options-for-banking-services","status":"publish","type":"post","link":"https:\/\/insidebitcoins.com\/news\/after-svb-crisis-coinbase-ceo-weighs-options-for-banking-services","title":{"rendered":"After SVB Crisis, Coinbase CEO Weighs Options For Banking Services"},"content":{"rendered":"
SVB, a bank serving startups in various industries, was closed down by the Department of Financial Protection and Innovation of California on March 10.<\/span><\/p>\n The closure of Silicon Valley Bank (SVB) on March 10, which has traditionally catered to startups across different industries, has caused shockwaves in the crypto community. Circle, the issuer of<\/span> USD Coin<\/span><\/a>, had over $3.3 billion of its $40 billion reserves locked up in the bank, raising concerns about the industry’s reliance on traditional financial institutions.<\/span><\/p>\n Signature Bank, another bank serving the cryptocurrency industry, also faced a similar fate as Silicon Valley Bank. On March 12, the New York Department of Financial Services took control of the bank to prevent a bank run as customers rushed to withdraw funds from both Signature Bank and Silicon Valley Bank.<\/span><\/p>\n The closure of SVB had a significant impact on the cryptocurrency industry, causing major uncertainty around Circle’s ability to manage redemptions and leading to a brief loss of the $1 peg for the USDC stablecoin.<\/span><\/p>\n Circle CEO Jeremy Allaire revealed that the company had secured new banking partners in the US, leading to USDC regaining its $1 peg after briefly losing it due to uncertainty caused by the closure of Silicon Valley Bank.<\/span><\/p>\n Following the recent closures of several major banks serving the cryptocurrency industry, there is heightened scrutiny regarding the relationships between crypto and traditional financial institutions that facilitate fiat transactions.<\/span><\/p>\n On March 13, Coinbase CEO Brian Armstrong tweeted that the American cryptocurrency exchange had previously contemplated offering features that could help bridge gaps exposed by the latest mainstream banking failure or bypass them altogether.<\/span><\/p>\nThe Crypto-Friendly Banks Shut-Down<\/strong><\/h2>\n
Will Coinbase Become A Neobank?<\/b><\/h2>\n