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Shock as Binance’s Partner Bank, a Bitcoin (BTC) Supporter, Declares Bankruptcy!
Switzerland’s financial regulator, the Financial Market Supervisory Authority (FINMA), has revealed that FlowBank, a proponent of Bitcoin (BTC) and cryptocurrencies, has gone bankrupt and is now closed.
Author:
Elif Azra Güven
14.06.2024 – 10:14
Update:
5 seconds ago
0
Switzerland’s financial watchdog, FINMA, has announced the bankruptcy and closure of FlowBank, attributing it to insufficient capital and significant debt.
After a recent investigation, FINMA found that FlowBank had seriously breached its obligation to maintain adequate capital and has ordered for the bank to be liquidated.
“The Swiss Financial Market Supervisory Authority, FINMA, has initiated bankruptcy proceedings against FlowBank SA on June 13, 2024.
This step was necessary as the bank was unable to meet the minimum capital requirements for its operations.
There are concerns that the bank may be heavily indebted.
The goal of the bankruptcy proceedings is to protect depositors. Based on current estimates, all priority deposits can be reimbursed from the bank’s available funds.”
Uncertainty Surrounds Cryptocurrency Refunds!
FINMA has indicated that refunds will prioritize customers with funds up to 100,000 Swiss francs ($111,710). However, the fate of customers’ cryptocurrency holdings remains uncertain.
It will be up to the liquidator to determine whether cryptocurrencies will be considered as custody assets, treated as securities in the bankruptcy process, or classified as liabilities of the bank.
FlowBank, established in 2020, delved into cryptocurrencies after CoinShares acquired a 9% stake in the bank in 2021 for $11.8 million.
Following this investment, the bank began offering clients the option to trade and hold crypto and other tokenized assets directly through their FlowBank accounts.
FlowBank also served as the banking partner for Bitcoin exchange Binance, offering custody services to select large investors who preferred not to keep their funds on the exchange.
*This is not financial advice.
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