Metropolitan Commercial Bank is on the verge of a complete departure from the cryptocurrency market, with only $278.5 million in crypto-related deposits remaining, according to an April 18 SEC filing. The bank stated that its exit from the crypto sector is nearly finished, while its total core deposits, excluding crypto clients, stood at $4.9 billion as of March 31.
Bank’s decision follows FTX’s collapse and regulatory pressure
The New York-based bank’s parent company, Metropolitan Bank Holding (MBH), announced its decision to terminate crypto-related services in January following industry developments and regulatory pressures.
This came shortly after the collapse of former crypto exchange FTX and multiple fraud charges against its founder, Sam Bankman-Fried.
The spectacular collapse of Silvergate Bank, Silicon Valley Bank, and Signature Bank has made U.S. banks increasingly cautious about serving the crypto industry.
Provident Bancorp’s co-CEOs Joe Reilly and Carol Houle, in an April 18 shareholder’s letter, attributed the recent banking crisis to the cryptocurrency downturn, which has left many crypto-related companies unbanked and prompted several firms to seek offshore banking options.
Meanwhile, domestic banks like BNY Mellon continue to service crypto clients but are adopting a more cautious approach when onboarding new digital asset-exposed clients.
