Following the failure of three large banks linked to cryptocurrency companies, software engineer Molly White believes that businesses now looking at banking options may be faced with “shader” solutions.
Speaking on March 14 at a South by Southwest (SXSW) panel in Austin, Texas on “Busting the Web3 Bubble,” White opined that crypto firms’ choices after the collapse of crypto-friendly Signature and Silvergate banks may metaphorically drive them underground. White compared the situation to 2017 and 2018, when crypto projects had “trouble getting into banking” with lower awareness and acceptance by institutions.
“There were only a handful of US banks that were actually willing to accept crypto clients”White said. “With Signature and Silvergate both out of the picture, I think that’s going to be very impactful in the crypto industry. [que] You still really need access to traditional finance and the banking rails of the United States.”
She added:
“Without [Signature y Silvergate], I think the cryptocurrency sector is going to have a hard time. Either they are going to have to find other banks that are willing to work with them, which was already difficult, and will probably only get more difficult after these banks collapse, or they are going to have to turn to some of the shadow banks. more murky”.
Many inside and outside the industry have claimed that the closure of Signature Bank by the New York Department of Financial Services was an overreach by authorities due to the company’s connection to cryptocurrency companies. Barney Frank, Signature Board Member and former US Representative, suggested that US government officials were trying to send a “strong anti-crypto message” by shutting down the bank, while the New York regulator said Signature failed to provide “reliable and consistent data” on its activities.
SXSW Austin will run through March 19 and will feature numerous speakers from the cryptocurrency and blockchain space. Cointelegraph published an interview with activist and cybersecurity expert Chelsea Manning on how blockchain technology can be used to address challenges with artificial intelligence.
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