Metropolitan Commercial Bank, a leading public bank in the United States, announced its departure from the cryptocurrency business, citing a significant drop in digital currency deposits from $820 million to $275 million as of March 31.
The bank, with a capitalization of approximately $5 billion, informed the Securities and Exchange Commission (SEC) of its decision in an official statement on April 18.
Metropolitan’s parent company stated that the bank will cease all cryptocurrency-related services.
The bank’s management attributed its decision to the recent collapse of Silvergate Bank, Silicon Valley Bank, and Signature Bank, as well as regulatory pressure on the banking industry to refrain from serving the crypto industry.
Custodia Bank’s application for membership in the Federal Reserve System was also rejected by the Fed’s Board of Directors because its crypto-focused business model did not align with the goals set forth in the Federal Reserve Act.