Key Takeaways:
- Until further announcement, Coinbase users won’t be able to transfer money using Signet outside of business hours.
- According to reports, the American cryptocurrency exchange was searching for a different payment network provider while awaiting the resolution of the issue with Signature.
According to an article published in the Wall Street Journal on March 20, Coinbase has stopped supporting Signet, a service that was once provided by the defunct Signature Bank.
Users of Coinbase who use Signet to make payments or withdrawals in U.S. dollars won’t be able to transfer money to one another outside of regular business hours. The business stated that it is searching for a new technology partner and is awaiting clarification on Signet’s result.
Two weeks ago, Silvergate proposed a “voluntary liquidation” of the Bank and a planned winding down of its operations in light of recent legislative and business advancements.
Coinbase previously declared that it was terminating its relationship with Silvergate Bank, and as of right now, the exchange no longer supports the bank’s Signet digital payment system.
However, a Coinbase spokesperson told the Journal that Coinbase users would still be able to make cryptocurrency deposits, withdrawals, and conversions from stablecoin USDC to U.S. dollars on Coinbase Exchange around-the-clock.
Much less is known about the future of Signet, a blockchain-based digital payments network. The payment network was introduced by Signature in 2019 as part of its push into digital assets, and some of the largest cryptocurrency players, such as stablecoin issuer Circle, were among its clients.
With the exception of about $4 billion in cryptocurrency deposits, the bank’s deposits and loans would be transferred to New York Community Bancorp’s Flagstar Bank, according to a statement from the U.S. Federal Deposit Insurance Corporation. The government-run company declared its intention to give cryptocurrency deposits immediately to clients” who have online banking accounts.
Before its collapse, the bank had been trying to reduce its presence in the cryptocurrency market following the failure of FTX and issues at rival Silvergate Bank, which also announced it was ceasing operations earlier this month.
