Banks Cannot Keep Shouldering Risks For Crypto And Fintech Clients

The cryptocurrency exchange Binance announced last week that Signature Bank will no longer process Swift transactions of less than $100,000 for crypto exchange customers. Up until now crypto firms and the U.S. financial technology industry has been able to rely upon banks to do the heavy lifting and absorb the costs of compliance and regulation. Perhaps that time of free-riding is finally coming to an end.

Customers and investors like fintech companies because they are perceived to be nimble and more capable than banks of delivering a superior customer experience. The impression remains, at least in the mind of some investors, that the fintech entrepreneurs are still able to live by the Facebook founder Mark Zuckerberg’s motto: “Move fast and break things.” Time for those perceptions to end.