Metropolitan Commercial Bank closes cryptocurrency business

Metropolitan Commercial Bank Holding has announced that it will exit the cryptocurrency industry. Representatives referred to changes in the regulatory framework for banks that deal with digital assets. This hinders their development and narrows business opportunities.

More than a week ago, US regulators warned everyone about the high level of leverage in the field of cryptocurrencies. After a wave of several bankruptcies and a drop in the value of cryptocurrencies last year, the market as a whole fell. Despite this, over the past 24 hours, the digital asset sector has shown more activity than usual in recent times.

Thus, on many exchanges, the daily turnover exceeded yesterday's figure by 2-3 times. There were separate cases when the trading volume was 5 or even 30+ times higher. You can read about it in our material .

By virtue of the fact that Metropolitan Commercial Bank did not hold cryptocurrencies and did not sell such assets to their clients, the consequences of their exit from the digital asset sector will be relatively low. The firm has four institutional clients that deal with cryptocurrencies. They account for about 1.5% of total profits and 6% of total deposits.

According to Mark DeFazio, Chief Executive Officer of Metropolitan Commercial Bank, in their case, the loss of customers working with cryptocurrencies will not put the company in significant risks:

Cryptocurrency-related customers, assets and deposits have never been a significant part of the company's business and have never exposed the company to significant financial risks.

Metropolitan Commercial Bank does not have any outstanding loans. The bank provides its customers with solutions for payment issues and issues debit cards. After the company closes the cryptocurrency division, the rest of the customers will not be affected and all the functionality will continue to exist in the same form as usual.

There are many opinions regarding the impact of cryptocurrencies on the economic system of the world. For example, recently the founder of the BitMEX crypto exchange, Arthur Hayes, said that the collapse of FTX would leave a negative imprint on the US economy and in 5 years, because of this, China could take the lead. At the same time, FTX, he said, will turn investors too far away from the world of digital assets.

At the same time, Laser Digital CEO Jez Mohideen shared a more non-trivial opinion . According to him, the bankruptcy of FTX showed how strong and resilient the entire cryptocurrency community and digital currency economy can be, which will attract more investors in the future.