March 29, 2024

Cryptobank First Republic is on the verge of bankruptcy

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Cryptobank First Republic is on the verge of bankruptcy

First Republic Bank has become anotheran American financial organization loyal to crypto companies, which faced a liquidity crisis, requesting assistance from the banking community and the US Federal Reserve System.

American First Republic in partnership withIsraeli trading and brokerage company eToro actively offered clients services for placing deposits and purchasing crypto assets through regulated and licensed exchanges. According to Forbes magazine, the bank has been among the ten largest private banks in the United States for the last four years in a row.

Amid news of the closure of Silicon Valley Bankand Signature Bank was unable to withstand the massive appeal of depositors, who withdrew deposits worth more than $70 billion from the bank. As a result, the bank’s market capitalization fell to $3 billion.

The Wall Street Journal reports thattroubled First Republic Bank turned to financial regulators, the banking community and the consulting company Lazard for help in overcoming the crisis, which includes the sale, reduction of assets or additional capitalization of the bank. Last week, 11 banks placed more than $30 billion in deposits with First Republic Bank in an effort to regain depositor confidence in the bank.

In addition First Republic receivedadditional liquidity from the Federal Reserve System and JPMorgan Chase, which partially improved and diversified the financial position of the credit institution. The amount of financial assistance provided by the parties was not disclosed.

A few days ago, the US Federal Deposit Insurance Corporation (FDIC) sold
Signature Bank to competitors from Flagstar Bank without the cryptocurrency part of the business.