Cryptocurrency mining company Marathon Digital Holdings has assured investors that the company’s cash deposits at Signature Bank are safe and available for use as of March 13.
In a release Following the closure of Signature Bank of New York, Marathon disclosed that it has approximately $142 million in cash deposits at Signature Bridge Bank.
The US Federal Deposit Insurance Corporation (FDIC) has created Signature Bridge Bank to manage customer accounts of the recently closed Signature Bank. The purpose of the bridge bank is to ensure that the flow of funds is not interrupted while the regulator searches for a buyer to acquire Signature Bank’s assets.
Marathon Digital Holdings’ deposits that were held at Signature Bank, New York, NY are secure and available for use as of Monday, March 13, 2023. Read the full update here: https://t.co/H5R6wpmB7Q
— Marathon Digital Holdings (NASDAQ: MARA) (@MarathonDH) March 13, 2023
Marathon also confirmed that it has access to its funds for treasury management purposes, and that it is conducting business as usual and paying all invoices as usual. Besides, Marathon still owns more than 11,000 Bitcoin (BTC), which the firm views as a financial asset that provides flexibility beyond the conventional banking system.
The company also clarified that it has no direct business ties to Silicon Valley Bank, which closed on March 10.
Signature Bank, a New York-based pro-crypto bank, closed on March 12 and was seized by the New York Department of Financial Services (NYDFS).
@federalreserve @USTreasury @FDICgov Issue statement on actions to protect the US economy by strengthening public confidence in our banking system, ensuring depositors’ savings remain safe: https://t.co/YISeTdFPrO
—Federal Reserve (@federalreserve) March 12, 2023
The Federal Reserve, in a statement published on March 12, explained that the decision to close the bank was made in collaboration with the FDIC to protect the US economy and bolster public confidence in the banking system.
Former US Congressman and Signature Bank board member, Barney Frank, has since suggested that the closure of Signature Bank by New York regulators was part of an anti-cryptocurrency message, as revealed in a CNBC note on March 13.
According to Frank, there was no indication of trouble at the bank beyond a run on deposits of more than $10 billion, which he attributed to contagion from the fall of Silicon Valley Bank.
The closure of Signature Bank by New York regulators makes it the third cryptocurrency-linked bank to fail in a week. Frank said that regulators might have wanted to display an anti-crypto message, and claims that Signature and Silvergate Bank were solvent at the time.
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