Signature’s $ 10 billion in deposits from crypto businesses are now twice that of rival Silvergate.
Deposits from digital currency customers now make up about 16% of total deposits in New York Signature Bank.
Signature revealed in a earnings call Thursday that deposits from customers in the crypto industry currently amount to $ 10 billion. This figure is twice that of California rival Silvergate Bank.
“We have become the leading player in this area,” said Eric Howell, the company’s vice president of corporate and business development. “It is clear that digital assets and cryptocurrencies will not disappear.”
Signature Bank CEO Joseph DePaolo added that Signet, the bank’s blockchain-based payment platform, is the main driver of deposit growth in digital asset banking, causing corporate adoption to “leap forward”. Prominent clients include Voyager Digital Holdings, Polychain Capital and bitFlyer USA.
Signature added $ 2.5 billion to interest-free deposits in the fourth quarter of 2020, which is down half a billion from Silvergate’s new $ 2.9 billion in deposits from digital currency customers in the fourth quarter.
Crypto companies are often a rich source of low-cost deposits for the few banks that openly serve the industry. For this reason, analysts have drawn a lot of attention to interest-free deposit growth in Signature.
Signature sees itself as a bank for high net worth individuals and institutions. The crypto banking business, on the other hand, has a low profile.
Total deposits in the bank increased by $ 8.98 billion on a quarterly basis, with money market deposits representing the lion’s share.
In the fourth quarter of 2020, the average cost of deposits and the average cost of funds decreased by 66 and 69 basis points, respectively, to 0.42% and 0.57% of Signature.