Signature Bank of New York to Open Up Banking Services for Bermuda’s Cryptocurrency Businesses

Signature Bank of New York is set to provide banking services to some cryptocurrency start-ups and other financial technology (fintech) companies in the Caribbean island of Bermuda.

The island’s government officially announced the news through a Thursday press release.

According to them, companies can immediately apply for banking support. 66 start-ups incorporated in the country will receive banking services to start, CoinDesk reported.

The official announcement came several days after Bermuda Premier David Burt indicated at the World Economic Forum how his country was going to launch crypto and blockchain-friendly bank.

Burt said an official notice about the plans would come soon.

Many banks have shied away from providing services to companies in the crypto and blockchain worlds. Financial entities have expressed fears of coming into conflict with banking regulations and international rules.

However, Signature Bank vice chairman John Tamberlane said the bank was impressed by Bermuda’s regulatory framework. Through a statement, Tamberlane noted how Signature was looking forward to working with the island government to

“help promote growth and expansion of the FinTech and digital asset industry.”

Premier Burt said Signature’s willingness to work with Bermuda-licensed businesses “is a significant vote of confidence in an endorsement of Bermuda’s efforts to create a leading high standard regulatory regime for FinTech business.”

Bermuda has long been a popular offshore financial center, and officials inside of the country have taken a relatively open approach towards crypto and blockchain. However, some of the island’s crypto-focused legislation has come under fire.

Former Wall Street executive Caitlin Long took to Twitter in early January to speak out against the Bermuda Monetary Authority’s December 2018 Digital Asset Custody Code of Practice draft.

She said people should be careful if a regulatory agent asks a custodian or exchange to have a “minimum amount of assets on-hand, within the organization, to withstand the withdrawal of all client assets,” making reference to the draft Code of Practice.

Long also criticized how there were no specific requirements that asked Digital Asset Businesses to hold client funds in a 1:1 manner. Long mentioned how she would not agree to store client assets with an entity that was subjected to such low requirements.

Overall, she argued Bermuda could do a better job and challenged the islands to ultimately deliver better crypto regulations.