Tag: Crypto Bank

Crypto Bank Anchorage Cuts 20% of Workforce

by Blockchain News

Anchorage Digital, a crypto bank that received a national trust bank charter from the Office of the Comptroller of the Currency in January 2021, has announced that it will lay off 75 employees, or approximately 20% of its workforce. The company cited regulatory uncertainty in the United States, as well as macroeconomic challenges and crypto market volatility, as reasons for the layoffs. Despite these challenges, Anchorage expressed continued confidence in the digital asset landscape and its ability to build regulated solutions for digital asset holders.

Anchorage’s decision to cut staff comes at a time when the U.S. banking system is facing significant challenges. Three regional banks, Silicon Valley Bank, Silvergate Bank, and Signature Bank, have gone under since March 8, prompting the Federal Deposit Insurance Corporation to guarantee all customer deposits for SVB and Signature, despite its standard threshold for guarantees being $250,000. It is unclear if these developments contributed to Anchorage’s decision to lay off staff.

The crypto industry has seen a slowdown in layoffs since the beginning of the year. In January, crypto firms such as Coinbase and Crypto.com cut nearly 3,000 positions, while February saw a more muted 570 layoffs. Despite the challenges facing the industry, many firms remain optimistic about the future of digital assets and blockchain technology.

Anchorage Digital was founded in 2017 by Diogo Monica and Nathan McCauley. The company provides custody services for institutional investors, allowing them to securely store their digital assets. In addition to its national trust bank charter, Anchorage has also received approval from the South Dakota Division of Banking to create a digital asset bank. The company’s investors include Blockchain Capital, Lux Capital, and Visa. Anchorage has raised over $137 million in funding to date.

While the layoffs at Anchorage are unfortunate for the affected employees, they may be necessary for the company to weather the current regulatory and market challenges. As the crypto industry continues to mature and attract more institutional investors, firms like Anchorage will play a critical role in providing secure and regulated custody services for digital assets.

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Crypto Bank BVNK Secures Operational License from the Bank of Spain

by Blockchain News

London-based digital currency banking service provider, BVNK has announced it is now a licensed Virtual Assets Service Provider (VASP) with the Bank of Spain.

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While there are a number of startups that offers related products and services such as BVNK, the startup’s offering is positioned to enable users to access financial services more easily.

 

BVNK’s business proposition is one that seeks to make its platform a one-stop shop that can cater to the needs of all investors. The platform offers a business account that enhances all user’s accessibility to foreign currencies like the United States Dollar (USD), the Euro, and the British Pound Sterling (GBP) amongst others.

 

Users will also gain access to crypto wallet services where they can also keep custody of their funds. BVNK offers yield products that enable the startup’s users to earn rewards in the form of interest on their capital. BVNK’s products also include its market offering, a trading engine that is designed for large-volume transactions.

 

The BVNK Insights is an analytics tool that provides all of the platform’s users with analytics into market trends, enabling them to make informed trading decisions. With its presence in Spain, prospective users will be able to gain access to the products and services as well as the host of others that it will be launching in the near future.

 

“The registration in Spain will be the first of many similar landmarks and demonstrates our commitment to becoming a globally recognised business that holds itself against the highest international regulatory standards,” said Maximilian von Both, chief legal, risk, and compliance officer, BVNK.

 

Spain is now growing to become a very generous European nation alongside France, Italy, and Cyprus as digital currency trading platforms are tapping licenses through regulators in these countries to gain access to the rest of Europe.

Image source: Shutterstock

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Crypto Bank Silvergate Capital Receives Bullish Rating from Wells Fargo

by Blockchain News

Silvergate Capital, a crypto state-chartered bank based in California, has received a bullish rating from Wells Fargo, which initiated coverage on the digital asset company with an overweight rating based on rising interest rates and prospects for further growth in its exchange network.

In a note, Jared Shaw, a Wells Fargo analyst, stated that Silvergate provides an opportunity for investors. The report further mentioned that the ongoing institutional adoption of cryptos and product innovation should help maintain Silvergate Capital’s (SI) growth profile.

Shaw wrote in a note that the current bear market makes an attractive entry point for institutions investing in cryptocurrencies. “As rates rise, higher spread income will come from a zero-cost deposit base, and further growth in SEN Leverage and the rollout of an SI-issued stablecoin payments network represent future opportunities,” the report stated.

Wells Fargo mentioned that the market is in the early stages of cryptocurrency and blockchain adoption. The note said that Silvergate offers a regulated and FDIC-insured platform for investors looking to on-ramp and off-ramp U.S dollars into the digital asset ecosystem.

The analyst pointed to Silvergate’s (SI) as the “biggest driver of deposits” and digital customer growth, as its client base has been growing at a 35%-40% rate year on year since 2019. The note further pointed out that Silvergate has developed a strong network impact via its Silvergate Network (SEN), which is used by some of the leading exchanges and institutions in the digital asset space. The report also stated that Silvergate plans to launch its own U.S.-based stablecoin payments platform late this year, unleashing new potential revenue opportunities.

The note stated that it “should drive much of the bank’s near-term profitability, as 77% of assets are securities (55% floating) and the loan book is also heavily floating-rate,” the note stated.

Wells Fargo’s view contrasts with its peers like Morgan Stanley, which gave Silvergate an equal weight rating last week.

Bitcoin Crashes Again

Wells Fargo’s ‘BUY’ rating for Silvergate comes despite the renewed crypto crash triggered by crypto lending platform Celsius’ pause on all withdrawals, swaps, and transfers between accounts due to “extreme market conditions.” Shares of Silvergate dropped more than 17%, and other crypto-focused stocks such as MicroStrategy and Coinbase collapsed during premarket trading on Monday as Bitcoin price plunged below $24,000 per coin.

Three weeks ago, the crypto market saw another worse selloff, exacerbated by rising interest rates and TerraUSD losing its peg to $1 and eventually leading to the collapse of both the stablecoin and Terra (LUNA).

Volatility continues to be the norm in crypto coins, and the latest fall witnessed on Monday is another reminder of that. But what is being done by payment systems and digital projects will continue to stabilize the market long term.

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Nebraska bill to allow banks to offer crypto services passes to final round

by Cointelegraph

Lawmakers in the U.S. state of Nebraska have taken another step towards passing a bill that will allow state banks to offer cryptocurrency services.

According to a May 19 tweet from Senator Julie Slama, the legislature called LB 649 has just passed to the final round of debate. She added that the bill establishes a statewide framework for cryptocurrency and digital asset banks in Nebraska:

“Excited for Nebraska to be a national leader in crypto!”

As reported by Cointelegraph earlier this month, the legislature was introduced by Republican Mike Flood in January. The bill aims to adopt the Nebraska Financial Innovation Act and create crypto asset depository institutions, in addition to providing for charter, operation, supervision, and regulation of these institutions.

According to the official timeline of events, the bill was advanced for enrollment and review on May 10, and it has now been adopted and passed to the final stage.

If passed, the legislature would make Nebraska the second U.S. state to formalize a charter for cryptocurrency-centric banks. Wyoming was the first state to do so, chartering its first crypto bank in September 2020.

Senator Mike Flood introduced the Transactions in Digital Assets Act and Adopt the Nebraska Financial Innovation Act to the state’s 107th Legislature in January with the hope it could help the state benefit from technology and finance jobs.

At the time, Senator Steve Erdman reportedly said that the bill was not anywhere close to being in a form where it could pass, in response to skepticism from some lawmakers. Three months later the bill is a lot closer to passing much to the satisfaction of those in favor of it such as Senators Flood and Slama.

When the bill was introduced, Flood stated “This is a once-in-a-lifetime opportunity not only for my district but the state of Nebraska,” after chatting with an entrepreneur friend who decided to move into the cryptocurrency industry in Wyoming.

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Crypto bank opens physical location in India’s capital as potential regulatory ban looms

by Cointelegraph

India’s Unicas crypto bank opened its third physical branch last week in New Delhi. Previous locations were launched in Jamnagar and Jaipur.

Unicas reportedly allows customers to access fiat and crypto services at the bank, and provides digital loans using crypto holdings as collateral. The bank aims to launch 50 branches across the country by the end of the year, and 50 more by the end of 2022.

Its plans may be stifled, however, due to a crypto bill that is awaiting consideration in India’s parliament. The Cryptocurrency and Regulation of Official Digital Currency Bill is intended to “prohibit all private cryptocurrencies” while also creating a regulatory framework for a digital rupee issued by the Reserve Bank of India. However, the bill also says it will allow for “certain exceptions to promote the underlying technology of cryptocurrency and its uses.”

In an earlier statement to Cointelegraph, Cashaa CEO Kumar Gaurav said “there is no way any government” can ban crypto given its nature as a global and decentralized system. However, he opined that the Indian government is attempting to crack down on crypto scams with the proposed ban.

“The government is only trying to put a full-stop to any scams operating in the name of crypto,” said Gaurav. “Overall, banning crypto will not be a win for anybody. And I trust even the government understands that very well.”

He added:

“Depriving the country of the technology and opportunity which is being created by crypto is not very different from depriving someone of the internet.”

The proposed legislation is currently being considered in the upper house of India’s Parliament as part of its budget session, which is in recess until March 7. However, the government is reportedly considering a legislative shortcut to pass the bill by using the “ordinate route.” This method would require the President of India, Ram Nath Kovind, to issue an ordinance when Parliament is not in session.

It is unclear how the bill passage would potentially affect Unicas’ operations in India. An anonymous source claiming to be a senior Indian Finance Ministry official claimed earlier this month that the use of all cryptocurrencies would be completely banned in the country under the proposed bill. However, Nischal Shetty, CEO and founder of India’s WazirX exchange said “the government isn’t in a hurry to make a decision” on crypto and might consult with stakeholders rather than outright banning it.