Regulation
FINMA Orders Closure of Crypto Bank FlowBank, Begins Liquidation
The Swiss financial watchdog, the Financial Market Supervisory Authority (FINMA), closed FlowBank and declared it insolvent. This came after FlowBank was found to lack proper capital and was reportedly in deep debt. Deposits of up to 100,000 Swiss francs are guaranteed, but the situation with the crypto assets is still unclear.
FlowBank Shut Down by Swiss Regulator FINMA
FlowBank, an online Swiss bank active in the crypto space, has been shut down by the Swiss FINMA. This comes against the backdrop of the bank being found to be having inadequate capital to support its operations. FINMA stated that FlowBank had violated the minimum capital requirements to a very high degree and in a severe manner. There are also some valid concerns regarding the bank’s current high level of indebtedness. Therefore, FINMA does not expect changes to the bank’s structure shortly.
In a letter to its customers published on the bank’s current website, FlowBank stated that it had received confirmation from FINMA. All bank web pages have been automatically redirected to this notice. A Swiss-based law firm, Walder Wyss, has been appointed the bankruptcy liquidator. This is a proper way to handle the bank’s shutdown and attend to customer needs.
FlowBank was established in 2020 and is a contemporary bank with strong connections to the crypto industry. In 2021, CoinShares, a crypto asset manager, acquired 9% ownership of FlowBank for $11.8 million. This investment allowed FlowBank to provide its customers with the ability to buy, sell, and hold cryptocurrencies and other tokenized assets through their accounts. This integration made FlowBank stand out as one of the leading banks in the crypto banking sector.
In the first quarter of the year, it was reported that Binance, the world’s leading cryptocurrency exchange, would allow some institutional clients to store their digital assets with FlowBank. This partnership revealed that FlowBank has a strong presence in the crypto market. However, the closure has implications for the future of such partnerships and the overall impact on crypto-friendly banks.
Crypto Deposit Fate Unclear Post-Bank Closure
The announcement of FINMA is somewhat comforting to FlowBank’s customers with conventional deposits. People with up to 100,000 Swiss francs in their accounts will get their money back within a week. However, the future of customers’ crypto deposits is less clear. According to FINMA, it is the liquidator’s responsibility to determine whether these cryptocurrencies are custody assets or claims on the bank.
The distinction is crucial. If classified as custody assets, cryptocurrencies will be treated like securities in bankruptcy, which could provide better protection for crypto holders. On the other hand, if treated as claims on the bank, the recovery of these assets might be more complex. This uncertainty is a significant concern for customers who have leveraged FlowBank’s crypto services.
FlowBank’s closure comes amid changes within FINMA’s leadership. Earlier this year, FINMA appointed Stefan Walter, a former European Central Bank (ECB) chief, as its new CEO, effective April 1, 2024. This decision followed the resignation of the previous CEO, Urban Angehrn, who left last year due to health reasons. The leadership transition at FINMA signals a potentially new regulatory approach in the Swiss financial sector.
Also Read: Gary Gensler Says ETH Spot ETF S-1 Might Be Approved This Summer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Chris Giancarlo, widely known as “Crypto Dad,” has emerged as the leading candidate for a newly proposed role of crypto czar in the White House under President-elect Donald Trump’s administration. The potential appointment underscores a strategic effort to advance crypto regulations and foster blockchain innovation in the United States.
This proposed position would be the first of its kind in the White House, aiming to bring clarity to the growing $3 trillion digital asset market. Chris Giancarlo, the former Chair of the Commodity Futures Trading Commission (CFTC), is known for his progressive approach to digital currencies and blockchain technologies.
Chris Giancarlo Leads Race for White House Crypto Czar Role Under Donald Trump
According to a Fox Business report, Chris Giancarlo is the top contender for the position of White House crypto czar, a role being considered by the Trump transition team to streamline crypto regulations and foster blockchain development.
As CFTC Chair from 2017 to 2019, Chris Giancarlo oversaw critical advancements in the digital asset space. This includes the launch of the first Bitcoin futures. He later co-founded the Digital Dollar Project, a nonprofit initiative exploring the potential of a U.S. central bank digital currency (CBDC). Giancarlo’s regulatory expertise and understanding of digital innovation position him as a key figure in shaping the future of the crypto sector.
The Trump administration aims to utilize this position to address industry concerns over the Biden administration’s perceived heavy-handed enforcement. The crypto czar would also collaborate with federal agencies to establish a framework for the $180 billion stablecoin market and enhance the overall regulatory landscape for blockchain and digital currencies.
Trump’s Strategic Approach to Digital Asset Policy
President-elect Donald Trump has expressed plans to make the U.S. a global leader in cryptocurrency and blockchain innovation. Part of this strategy includes appointing a crypto czar to advance policies to support the industry’s growth.
Trump has also proposed the establishment of a presidential crypto advisory council to address ongoing regulatory challenges. This initiative aims to align federal policies with industry needs, fostering a competitive environment for blockchain businesses. The council will explore the creation of a Bitcoin reserve as part of the administration’s broader crypto policy agenda.
The transition comes as current SEC Chair Gary Gensler announced his resignation effective January 20, 2025, coinciding with Trump’s inauguration. Gensler faced criticism during his tenure for his enforcement-driven approach to crypto regulations.
Amid speculation, Chris Giancarlo clarified that he is not pursuing the SEC Chair role. Giancarlo said in a recent statement,
“I’ve already cleaned up earlier Gary Gensler mess at the CFTC and don’t want to have to do it again.”
His focus remains on advancing crypto-friendly policies through a potential new role. According to the report, the “Crypto Dad” stated,
“I would be honored to be considered for the role.”
The creation of the crypto czar position could mark a pivotal moment in the evolution of U.S. crypto policy. With Chris Giancarlo leading the race, the industry anticipates advancements in crypto regulations under the new administration.
Ronny Mugendi
Ronny Mugendi is a seasoned crypto journalist with four years of professional experience, having contributed significantly to various media outlets on cryptocurrency trends and technologies. With over 4000 published articles across various media outlets, he aims to inform, educate and introduce more people to the Blockchain and DeFi world. Outside of his journalism career, Ronny enjoys the thrill of bike riding, exploring new trails and landscapes.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
- The UK will introduce unified crypto regulations, including stablecoins, in early 2025.
- New rules aim to simplify oversight and avoid restrictive staking classifications.
- Labour government aims to compete with EU’s MiCA rules and US pro-crypto policies.
The United Kingdom is set to introduce a comprehensive regulatory framework for cryptocurrencies, stablecoins, and crypto staking services in early 2025, marking a pivotal shift in its approach to digital assets.
The announcement was made by the Economic Secretary to the Treasury Tulip Siddiq at City & Financial Global’s Tokenisation Summit in London on November 21.
Initially slated for December 2024, the regulatory rollout was delayed due to the change in government following the election of Prime Minister Keir Starmer’s Labour administration in July 2024.
The upcoming UK crypto regulatory framework
The upcoming framework consolidates regulations for crypto assets into a single, overarching regime, a decision Siddiq described as “simpler and more logical.”
The framework aims to provide clarity in a rapidly growing sector that has faced uncertainty in the UK.
Stablecoins will receive distinct treatment under these regulations, as their functionality does not align with existing payment services rules.
Siddiq highlighted that staking services would also avoid being designated as “collective investment schemes,” a classification that could impose burdensome restrictions.
UK aims to align with the global crypto regulatory landscape
The UK government’s renewed focus on digital asset regulation comes as it seeks to align with global developments. The European Union’s Markets in Crypto-Assets (MiCA) regulations will be fully enforced by the end of 2024, offering regulatory certainty that has positioned Europe as an attractive market for the crypto industry.
Meanwhile, the US, under President Donald Trump’s administration, has adopted a markedly pro-crypto stance, including the establishment of a White House “crypto czar” and SEC Chair Gary Gensler’s planned departure in January 2024.
The Labour government has shown its intent to catch up with international competition. In September 2024, it introduced a bill recognizing NFTs, cryptocurrencies, and carbon credits as property.
The new regulatory push reflects the UK’s ambition to regain credibility as a crypto hub while addressing criticisms of the Financial Conduct Authority’s perceived stringent oversight.
By delivering a robust, streamlined framework, the Labour government aims to bolster the UK’s standing in the multibillion-dollar crypto industry.
In a recent development, the US Securities and Exchange Commission (SEC) announced that Gary Gensler will step down from his position next year. This follows calls for Gensler to resign since Donald Trump won the US presidential elections.
Gary Gensler To Step Down As US SEC Chair
The US SEC announced in a press release that Gary Gensler will depart the Agency on January 20, 2025. The US SEC Chair also confirmed this development in an X post. Interestingly, this comes on the same day that Donald Trump will be inaugurated as the 47th president of the United States.
Following the announcement, Gensler also used the opportunity to reflect on his time at the Commission. He remarked that it has been an “honor of a lifetime” to serve alongside those at the SEC. He also thanked President Biden for the opportunity to serve in the position. Gensler has been the US SEC Chair since April 2021. During his time, he has spearheaded several litigations against the crypto industry.
This includes the long-running legal battle with Ripple, which Gensler took over from his predecessor Jay Clayton, which bordered on whether XRP was a security. Up till now, the Agency continues to reiterate this ‘digital asset securities’ claim.
Boluwatife Adeyemi
Boluwatife Adeyemi is a well-experienced crypto news writer and editor who has covered topics that cut across DeFi, NFTs, smart contracts, and blockchain interoperability, among others. Boluwatife has a knack for simplifying the most technical concepts and making it easy for crypto newbies to understand. Away from writing, He is an avid basketball lover and a part-time degen.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
XRP Price Rally to $2 As Paul Atkins Leads to Replace US SEC Chair Gary Gensler
Solana Hits New All-Time High After 3 Years
Bitcoin’s Put-to-Call Ratio Tops 1.0: Bearish Signs Ahead?
Solana Hits New ATH On Huge Whale Accumulation, More Gains Ahead?
XRP Price 25% Rally: Breaking Barriers and Surpassing Odds
Dogecoin Hashrate Surges To New All-Time High Amid Rise In Positive Momentum
2.52 Million Altcoins Are Ruining Crypto’s Future
Animoca Brands Valuation Tanks 75% In Two Years, Here’s Why
Crypto exchange BingX hacked for $43 million
Are The Big Players Losing Interest?
Hong Kong’s Securities Association Tips Authorities On Crypto Self-Regulation
Coinbase cbBTC Set to go Live on Solana
2.52 Million Altcoins Are Ruining Crypto’s Future
Animoca Brands Valuation Tanks 75% In Two Years, Here’s Why
Crypto exchange BingX hacked for $43 million
Are The Big Players Losing Interest?
Hong Kong’s Securities Association Tips Authorities On Crypto Self-Regulation
Coinbase cbBTC Set to go Live on Solana
-
Market21 hours agoSouth Korea Unveils North Korea’s Role in Upbit Hack
-
Market16 hours agoETH/BTC Ratio Plummets to 42-Month Low Amid Bitcoin Surge
-
Altcoin23 hours agoWhy FLOKI Price Hits 6-Month Peak With 5% Surge?
-
Bitcoin16 hours agoMarathon Digital Raises $1B to Expand Bitcoin Holdings
-
Altcoin21 hours agoVitalik Buterin, Coinbase’s Jesse Pollack Buy Super Anon (ANON) Tokens On Base
-
Altcoin16 hours ago5 Key Indicators To Watch For Ethereum Price Rally To $10K
-
Market15 hours agoSEC Moves Toward Solana ETF Approval Amid Pro-Crypto Shift
-
Altcoin19 hours agoSui Network Back Online After 2-Hour Outage, Price Slips
✓ Share: