An official statement from the bank revealed that cryptocurrency accounts held by its clients will be terminated, and the bank will proceed with selling off these digital assets. However, Vast Bank has stated that it will not facilitate the transfer of crypto assets to other custodial storage platforms or digital trading platforms. Instead, the bank will convert the cryptocurrency assets into cash and distribute the proceeds to owners via cashier’s checks.
Furthermore, Vast Bank has already disabled and removed its mobile banking application that previously facilitated cryptocurrency transactions.
The decision to cease digital asset operations by Vast Bank is attributed to pressure from the US Office of the Control of Currency (OCC). As per the regulator’s order, the bank is required to achieve a total capital ratio of at least 13% and a leverage ratio of at least 10% within the next 60 days. By December 31, 2023, Vast Bank’s total capital ratio stood at a mere 4.75%, and the leverage ratio was at 2.46%.
Vast Bank initially launched its crypto banking services in 2021, which allowed customers to store and trade digital assets freely.
Interestingly, a proposal has been introduced in the US Congress by a group of lawmakers to repeal legislation that grants the Securities and Exchange Commission (SEC) the authority to mandate banks to include their customers’ digital assets on their balance sheets.