The year 2023 was notably intense with numerous year-end summaries published this week, covering over 160 significant developments and the top 200 cryptocurrencies’ growth. Readers can find these summaries using the search function.
The 2023 Banking Crisis, triggered by rapid interest rate hikes by the Fed, led to the collapse of several banks including Silicon Valley Bank and Silvergate Bank. The crisis was exacerbated when customers rushed to withdraw funds, only to find banks unable to honor requests due to losses from discounted bond sales.
The Fed’s intervention, providing liquidity and guaranteeing amounts over $250,000, stabilized the situation. However, the crypto warning from the Federal Reserve Board, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency was a significant shock.
Regulatory bodies advised banks against entering the crypto space, citing asset risks. The fall of crypto-connected banks Silvergate and Signature highlighted the delicate balance between innovation and stability in merging traditional finance with the crypto world.
With the collapse of major crypto-supportive banks, US citizens faced new challenges. The sudden disappearance of Silvergate’s SEN and Signature Bank’s Signet networks disrupted operational flows and access to liquidity, adding pressure to an already troubled sector.
Emerging networks like BCB Group’s Blinc offer some hope, but lack the extensive customer base of their predecessors. Customers Bancorp and Cross River Bank have stepped in, launching real-time payment platforms similar to SEN and Signet, attracting significant crypto clients like USDC issuer Circle.
Finally, Western Alliance Bancorp and Axos Financial have also contributed to meeting the needs of the crypto industry, indicating that despite setbacks, the sector continues to evolve and adapt.