FDIC: Signature Cryptocurrency Clients Must Close Accounts By April 5th

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Federal Corporation forUS deposit insurance (FDIC) said that cryptocurrency clients of the bankrupt Signature Bank have until April 5 to close their accounts and withdraw money.

Since March 20, 40 former Signature branchesoperate under the management of Flagstar Bank. Signature depositors, other than those in the digital banking business, automatically became depositors of New York Community Bancorp-owned Flagstar. All deposits accepted by Flagstar remain FDIC insured.  However, the FDIC recalled that the Flagstar deal did not include approximately $4 billion in deposits related to Signature's cryptocurrency business.

“We recommend that clients transfer these deposits before April 5. If they do not arrive by that date, we will mail checks to the address of record.”

Signature was founded in 2021.At the time of his collapse, he had more than $110 billion in assets. The bank's activities were multidirectional and cryptocurrencies were not the main priority, like Silvergate. The bank started dealing with them only at the end of 2018. They accounted for about 23% of all deposits, while Signature was going to reduce their share to 15%. 

Even before the purchase of Signature, appeared in the mediainformation that the FDIC sets a condition for future purchasers of Signature: they must abandon the bank’s entire cryptocurrency business. However, the FDIC denied these rumors.