Today Metropolitan Commercial Bank announced that it plans to withdraw from servicing clients in the crypto-asset sector following a review by its board. It cited the drivers as the ‘recent developments’ in the crypto-asset sector, presumably including the crypto crash and bankruptcies such as FTX, as well as significant moves on the regulatory front. Crypto only represents a small part of Metropolitan’s business.
Metropolitan, with total client deposits of $5.7 billion at the end of Q3 2022, said that crypto-asset businesses represented 6% of deposits (around $350 million) and 1.5% of revenues with four institutional crypto-asset related clients.
Last week Silvergate, the bank most exposed to the crypto sector, reported that it effectively had a run on the bank in Q4, with digital asset customer deposits down around $8 billion or 68% during the quarter. As a result, it is cutting 40% of its staff, but the bank is liquid and still committed to the sector so far.
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