• The NYDFS Superintendent Adrienne Harris clarified that the closure of Signature Bank was not related to crypto activities.
• She noted that many crypto firms lack maturity in their compliance programs and need to scale up their Bank Secrecy Act-anti-money-laundering compliance and cybersecurity.
• Under Harris’ leadership, the NYDFS has increased staffing in its digital asset unit, which now employs more than 50 people.
NY Finance Regulator Clarifies
The New York Department of Financial Services (NYDFS) Superintendent Adrienne Harris has said that the closure of Signature Bank last month was due to liquidity issues rather than its clients in the crypto industry. She stated that the idea that it was an attempt to target the crypto sector is “ludicrous”.
Operation Choke Point 2.0
The news follows what some have called Operation Choke Point 2.0 – a US crackdown on crypto – but Harris made it clear this wasn’t the case for Signature Bank’s closure. “The idea that taking possession of Signature was about crypto and this is ‘Choke Point 2.0’ is really ludicrous,” she said at a Chainalysis conference hosted by Links NYC on Wednesday.
Crypto Firms Lack Maturity
Harris also noted at the conference that there’s still a lack of maturity around Bank Secrecy Act-anti-money-laundering compliance and cybersecurity among many crypto firms, even as they have grown in prominence: “There is still a lack of maturity around Bank Secrecy Act-anti-money-laundering [compliance] and cybersecurity.” According to her, many companies’ compliance programs consist mainly of paper documents and Excel spreadsheets, meaning they need scaling up quickly if they wish to succeed as businesses.
More Staff for Digital Asset Unit
In order to help combat this issue, Harris revealed under her leadership; the NYDFS has increased staffing in its digital asset unit, which now employs more than 50 people. She hopes that by setting regulatory standards for other states through New York’s role as an industry leader will improve outcomes across all sectors involving cryptocurrency operations nationwide.
Signature Bank Closure Unrelated
To conclude, it’s evident from Harris’ statements at the Chainalysis event that Signature Bank’s closure had nothing to do with targeting cryptocurrency or any other kind of suspicious activity – instead it was down simply due poor liquidity levels leading to liquidation proceedings being taken against it by NYDFS last month – providing reassurance for those working within crypto circles across America