The US FDIC has stated that it is necessary to abandon cryptocurrency business in order to acquire SVB and Signature banks.

After being taken over by the Federal Deposit Insurance Corporation (FDIC) last week, Silicon Valley Bank and Signature Bank have been actively seeking a buyer.According to Reuters, FDIC has requested potential buyers interested in acquiring these two banks to submit their bids by March 17th.

This will be FDIC’s second attempt to sell Silicon Valley Bank after its previous attempt failed last Sunday. Sources reveal that the FDIC has hired investment bank Piper Sandler Companies to conduct a new round of auction.The goal of the FDIC is to bundle Silicon Valley Bank and Signature Bank for sale, but if they cannot be sold together, partial equity sales of these two banks can also be considered.

The winning bidder will be required to agree to relinquish their involvement in cryptocurrency transactions.

Two sources mentioned that currently only bidders holding banking licenses can study the financial conditions of two banks before submitting their quotes, aimed at giving traditional banks an advantage over private equity firms.Any purchaser of Signature Bank must agree to relinquish the bank’s cryptocurrency business.

It is reported that some banks, including PNC Financial Services and Royal Bank of Canada, had intended to bid for Silicon Valley Bank during last weekend’s auction but ultimately decided to withdraw.The Royal Bank of Canada acquired City National Bank, headquartered in California, in 2015.

President Biden said earlier this week that depositors’ funds at Silicon Valley Bank and Signature Bank will be safe and taxpayers will not bear any losses.As any funding shortfall will be supplemented by government funds, successfully selling these two banks would minimize the funding gap to the greatest extent possible.

The board of directors of Signature Bank once questioned regulatory agencies.

The New York State Department of Financial Services (NYDFS) unexpectedly closed Signature Bank, a cryptocurrency-friendly bank, last Sunday, making it the third-largest bank closure in US history.However, Signature Bank board member Barney Frank stated on the 13th that the bank was not insolvent and that its closure may have been due to regulatory authorities wanting to send a strong “anti-cryptocurrency signal.”

However, the New York State Department of Financial Services issued a statement yesterday refuting allegations that the decision to shutter Signature Bank was related to its digital asset business.”The decision to take over the bank and transfer it to the FDIC was based on the current situation of the bank and the consideration of its ability to conduct business safely and soundly.”

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