- The suggestion that Signature Bank was closed due to anti-crypto bias has been labeled “really ludicrous” by the head of New York’s regulator
- Adrienne Harris reaffirmed that the closure was down to uninsured deposits and the risk of a bank run
- Plenty of such incidents have added to the suggestion that authorities are choking crypto on-ramps
The head of New York State’s Department of Financial Services (DFS), Adrienne Harris, has labeled suggestions that Signature Bank was closed because of an anti-crypto bias “really ludicrous”. Speaking at a recent Chainalysis event, Harris was also dismissive of assertions that her department’s closure of the Signature Bank was part of a wider scheme to strangle the crypto industry. Such theories have grown in strength following other similar events and several smaller ones that are all adding up to the suggestion that U.S. authorities are choking the crypto space of liquidity in an attempt to kill it.
“Really Ludicrous” That Crypto Was a Factor
During the panel conversation at Chainalysis Links NYC 2023, Harris restated the regulator’s position that the closure of Signature Bank was unrelated to its cryptocurrency banking activities but was instead based on factors such as its high percentage of uninsured deposits and its lack of liquidity to honor withdrawal requests:
The idea that the taking possession of Signature was about crypto and this is ‘Choke Point 2.0’ is really ludicrous.
The suggestion of an anti-crypto bias was supported by former U.S. representative and Signature Bank board member Barney Frank, who said in the immediate aftermath of the closure last month that the issues could have been resolved if the DFS had communicated its concerns with the bank instead of simply closing it down.
Instead, it shuttered the bank at a weekend, with Frank saying the actions of regulators clearly pointed to a “very strong anti-crypto message”. This was disputed by a DFS spokesperson at the time, who said that the decision to take possession of the bank was down to “the current status of the bank and its ability to do business in a safe and sound manner” the following Monday.
