The New York City Banking Commission has decided toย delimit deposits for two banks as the Unitedย States banking crisis deepens. Can Bitcoinย (BTC) โfix this?โ
On May 25, the New York City Comptroller, the City Mayor, and the Department of Finance voted toย delimit deposits at Financialย resources 1 and KeyBank.
The move comesย after the banks โfailed to submit required plans demonstrating their efforts to root out discrimination,โ reportsย by the Comptroller.
It is the latest blow to the Unitedย States banking system, which has been under enormous pressure this year.
New York City Banking Crackdown
Alongย with the crackdown on these two banks, 3 others were voted against. New York City Comptroller Brad Lander voted against designating International Finance Bank, PNC Bank, and Wells Fargo from holding public funds.
โBanks seeking to do business with New York City must demonstrate that they will be responsible managers of public funds and responsible actors in our communities,โ he said.
5 banks had failed to comply with New York City Banking Commissionโs strictย controls. Nonetheless, the Commission did approve 26 other depository banks in the state for two years.
Banks must file certificates concerning their policies of non-discrimination in hiring, promotion, and delivery of banking services to operate in New York.
Furthermore, the two banks with frozen deposits were not small fry. Financialย resources 1 held $7.2 Million in City deposits at the end of April across 108 accounts. KeyBank held $10 Million in City deposits at the end of April.
This yearโs collapses of Silicon Valley Bank (SVB), Signature Bank, and 1st Republic Bank have roiled the banking sector. The Federal Reserve responded with emergency loans to distressed banks, hinting that price hikes mayย be over soon.
There are rumblings that two more Unitedย States banks, PacWest and Western Alliance, canย potentially be theย following to fall.
Furthermore, Americaโs largest bank, JPMorganย Chase & Co Chase, is slashing around a thousand jobs at 1st Republic Bank after buying the failed company this month.
Research likewise impliesย that as numerous as half of the banks in America mayย be insolvent.
Is Bitcoinย (BTC) The Answer?
Cryptocurrency proponents will argue that Bitcoinย (BTC) is the solution to all of this banking bunkum. Nonetheless, it still relies on fiat on and off-ramps, which means involving banks.
For this reason, most retail banks and nearly every monetaryย authority are against Bitcoinย (BTC) and cryptocurrency. It was spawned from the 2008 bank-induced financial crisis and remains the largest threat to banks.
