Metropolitan Commercial Bank is about to fully exit the cryptocurrency market with $278.5 million in crypto-related deposits remaining, according to a filing with the Securities and Exchange Commission (SEC) from April 18.
“Our previously announced exit from the crypto-related vertical is almost complete,” the filing said, noting that its total deposits, excluding crypto clients, $4.9 billion as of March 31.
The bank’s New York-based parent company, Metropolitan Bank Holding (MBH), announced in January that it was ending crypto-related services following recent industry developments and regulatory pressure. The decision came shortly after the former crypto exchange FTX collapsed and its founder, Sam Bankman-Fried faced several fraud charges.
Metropolitan Bank serves four crypto clients that account for nearly 1.5% of its total revenue, about $1 million, and 6% of total deposits that amount to $342 million, according to Q3 2022 results of company.
US banks are cautious about servicing the crypto industry, following the spectacular collapse of three of the most prominent banks – Silvergate Bank, Silicon Valley Bank and Signature Bank.
In fact, another bank – Provident Bancorp – blamed the winter of crypto as the main cause of the recent banking crisis. “In the past few months the country has witnessed a chain of events that have shaken the foundations of the banking industry,” wrote co-CEOs Joe Reilly and Carol Houle in a shareholder letter dated April 18. “These events come on the heels of a cryptocurrency downturn that has affected many businesses, including some that we support through our digital asset lending initiatives,” they wrote.
This recent crisis has also made many crypto-related companies unbanked and has seen many companies trying to move their banks offshore. Meanwhile, some of the domestic banks, including BNY Mellon, which still serve crypto-related clients, say they are taking a slow approach to getting new clients exposed to the digital asset. .