The officials at the Okcoin exchange made an announcement on March 13 pertaining to their affiliation with the Silicon Valley Bank (SVB).
Okcoin Exchange’s Not Exposed to SVB
The executives at the exchange revealed that they do not have any connection with the Silicon Valley Bank that recently went out of business.
It was on March 10 when the SVB was taken down by the Feds and all of its funds were seized by the FDIC.
As a result, multiple crypto firms ended up facing huge problems as they lost their investors due to FUD. Many firms including Circle announced that it was exposed to the defunct bank.
Circle is known for issuing the second-largest stablecoin, USDC, and it revealed being exposed to $3.3 billion in reserves.
With many firms from the crypto industry announcing being exposed to the SVB, the Okcoin investors wanted to know if it was exposed to the bank or not.
Hong Fang, the CEO of Okcoin, tweeted on March 13 that their exchange has no affiliation with the US-based bank. This was a breather for the entire crypto industry concerned about the Okcoin exchange.
Okcoin is exposed to Signature Bank
Although Fang confirmed they were not exposed to SVB, he confirmed that they are exposed to another major banking firm in the US.
According to the reports, Signature Bank was the third bank in the United States that ended up closing down its business. In actuality, it was the Feds who shut down the Signature Bank after shutting down the Silicon Valley Bank.
Fang has verified through the tweet that they have been exposed to the Signature Bank.
ACH and Dollar Wire Deposits Dropped Immediately
After confirming to the community that they were exposed to the Signature Bank, he went on to confirm that they had paused certain deposit options.
As per the announcement, the exchange has now paused deposits for ACH and for USD. These deposits were paused right after the Signature Bank ended up getting shut down by the Feds.
Fang revealed that Signature Bank is their primary partner. They were using the services offered by Signature Bank to offer dollar transaction options to the users.
Signature Bank’s Closure
It was just two days after the closure of the SVB the Signature Bank was closed. It was the regulatory authority based in New York State that took action against the bank to take it down.
Signature Bank had been building up its reputation as one of the largest proponent banks towards cryptocurrencies. It offered crypto firms the ability to convert their cryptocurrencies to fiat through their platform.
However, the regulators took it down citing systemic risks. They claimed that the US economy was at dire risk of collapsing if such banks kept offering support to the crypto firms that were too risky to operate.
Temporary Pause of other Services
According to Fang’s tweet, the USD deposits are not the only option they have paused for the users. They have paused another utility for the users.
As of now, the users at the Okcoin exchange are unable to access the over-the-counter services offered through their platform.
On top of the OTC services, they have paused the recurring buy and the quick buy functions. They have revealed that these options have been paused temporarily but there is no definite time of reinstatement.
Even the users purchasing cryptocurrencies through a credit card will not be able to do it. Until the matter has been dealt with, the users won’t have access to the trading pairs including the USD either.
Funds are Safe
Most of the users had one query to make and that was about the safety of their funds. Fang replied to these queries confirming that all the funds belonging to the customers and in the corporate accounts were safe and secure.
Fang clarified that these suspensions are temporary and will be reinstated so the users must not worry about these options being taken off permanently.
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