Crypto-linked Cross River Bank receives FDIC order

Cross River Bank has received a consent bid from the FDIC demanding further oversight, according to a filing made nationalist connected April 28.

Bank receives bid for lending compliance

The FDIC suggested successful that filing that Cross River Bank engaged successful “unsafe oregon unsound banking practices” related to just lending laws and regulations.

The regulator demanded that the institution present greater oversight and controls and marque corrections done a related agreement.

Cross River Bank volition neither admit nor contradict wrongdoing, the bid said.

In a abstracted study from the Wall Street Journal, a typical from Cross River Bank said that the enactment was related to a reappraisal of the company’s lending practices from 2021 alternatively than its cryptocurrency oregon payments concern activities.

The slope was besides antecedently targeted by the FDIC successful 2018 erstwhile the regulator compelled the institution to alteration definite practices and wage a good of astir $642,000.

Cross River Bank serves crypto clients

Cross River Bank is known to service and enactment with assorted cryptocurrency companies including crypto speech Coinbase and USDC issuer Circle.

The institution antecedently described a “crypto first” strategy to the tech quality tract TechCrunch successful March 2022. There, a spouse steadfast of Andreessen Horowitz suggested that the steadfast supports “many different starring crypto companies.”

Though the FDIC’s actions are not related to the bank’s crypto business, the incidental is notable owed to the failures of different crypto-friendly banks specified arsenic Silvergate Bank and Silicon Valley Bank, some of which collapsed successful March.

Those incidents show that important contention could origin Cross River Bank’s crypto clients to interruption ties with the slope oregon pb clients to marque higher-than-usual withdrawals — though determination is nary denotation that this is occurring astatine present.

The station Crypto-linked Cross River Bank receives FDIC order appeared archetypal connected CryptoSlate.