The ongoing extinction of banking options for crypto firms might not cause an industry collapse. But token traders in the short-term are likely to find increased costs and market inefficiencies while companies try to re-establish connections to the traditional finance system.
Digital-assets firms had already struggled this year to hang on to their banking relationships amid stringent regulatory guidance. Then, in less than a week, three of the banks most willing to work with the industry— Silvergate Capital (ticker: SI), SVB Financial Group (SIVB), and Signature Bank (SBNY)–went out of business or announced that they would do so.