New York financial regulator denies reports of Signature Bank’s closure being related to crypto

• The New York Department of Financial Services (NYDFS) claims that the bank failed to provide reliable data.
• The regulatory body was also questioning the bank’s leadership, calling it a “significant crisis”.
• The crypto market has managed to recover in the last few days as the market capitalization rose back above $1 trillion.

The ongoing banking crisis in the United States has drawn a lot of attention from rumors and inaccurate information as to why two banks were shut down. Addressing one of them, the New York regulatory body discussed what went wrong that resulted in Signature Bank’s closing.

NYDFS has no confidence in the banks’ leadership

The New York Department of Financial Services (NYDFS) discussed the actual reason behind the shutdown of Signature bank. According to a report from the International Business Times, the regulator was quick to deny all the rumors regarding the crypto angle of the shutdown, saying that the Signature Bank shuttering had nothing to do with crypto.

Further discussing the real reason, the regulatory body noted that Signature Bank actually “failed to provide consistent and reliable data”. Talking about the same, NYDFS said that the regulator also noticed a severe crisis of confidence in the bank’s leadership.

Last week, Signature Bank met the same fate as Silicon Valley Bank, which had been shut down just a few days earlier, making it the second bank to suffer such a fate within a week.

In the case of the latter, the California Department of Financial Protection and Innovation was responsible for shuttering it. However, the wave of bank failures began with the crypto-focused bank Silvergate Bank that announced its plans to wind down and liquidate just days before.

The crypto market recovers its losses

The crypto market took a serious hit around the time when banks began failing, and the total crypto market capitalization declined from nearly $1.1 trillion to $873 billion at one point last week. However, the green candles observed over the next few days pulled the market cap back up.

Total crypto market capitalization

At the time of writing, the combined value of all cryptocurrencies in the market came up to $1.064 trillion, with figures even touching the highs of $1.119 trillion at one point during the intra-day trading hours. The seeminigly positive reaction from the US Consumer Price Index (CPI) data on Tuesday further helped maintain a bullish narrative for cryptocurrencies.