28.10.2020

Crypto Firm Deposits Jump 24% in Q1 at Metropolitan Commercial Bank

While the $3.6 billion-asset bank more than doubled its loan loss provisions to $4.8 million in the first quarter, the bank’s overall deposit base grew by $231 million quarter over quarter, including a $25 million increase from the crypto sector, according to its earnings release. The level of digital currency deposits is 24 percent higher than last quarter but 40 percent lower than the same quarter last year.

Deposits from digital currency customers at New York-based Metropolitan Commercial Bank – one of the few U.S. banks openly serving the crypto industry – increased for the first time in more than a year.

The share of those deposits that were crypto customers also grew from 3.7 percent of total deposits in the fourth quarter of 2019 to 4.2 percent of total deposits, or $129 million, in this last quarter.

While the steady decline in the bank’s crypto business has stopped, Metropolitan Commercial will likely keep the business line steady at around 4 percent of total deposits, said Christopher O’Connell, a bank stock analyst at investment firm Keefe, Bruyette & Woods.

“It’s still something that they’re maintaining, but it’s not a primary driver of growth,” O’Connell told CoinDesk. Metropolitan Commercial declined to comment for this story and did not talk about its digital currency business on its first-quarter earnings call Monday.

The bank saw the greatest decrease in its corporate cash management deposits, which fell by $155 million. The bank more than doubled its loan loss provisions to $4.8 million in the first quarter as a response to the COVID-19 pandemic.

The size of its digital currency deposits is still lower than historical averages. In Q1 2019, the bank had $210 million from the crypto sector. Metropolitan’s digital currency banking peak came in the second quarter of 2018, at $369 million in deposits from the sector.

On the lending side, the bank continues to look like a traditional bank, with more than half of its loans going to commercial real estate projects.

In its investor presentation, Metropolitan Commercial highlighted BitPay, Crypto.com, Coinbase and other crypto companies as firms that take advantage of its global payments business.

In comparison, Metropolitan’s rival – La Jolla, Calif.-based Silvergate Bank – had $1.2 billion in deposits from cryptocurrency clients at the end of the fourth quarter of 2019. (Silvergate is scheduled to report its first-quarter earnings on April 29.)

New York-based and crypto-friendly Signature Bank saw a $1 billion rise in non-interest bearing deposits in the fourth quarter of 2019. In the first quarter of this year, Signature reported non-interest bearing deposits made up 32 percent of total deposits at the bank, or $13.4 billion. While the bank hasn’t shared the total value of its deposits from crypto customers, the crypto industry is typically among the primary sources of non-interest bearing deposits.

Crypto Forensics Firm TokenAnalyst Shuts Down, Some Employees Hired by Coinbase

Crypto intelligence firm TokenAnalyst has shut its doors, the company announced Tuesday.

The group said in a Medium post it would stop supporting its platform and application programming interface (API), and a flashing note on the company’s website says, “The data on this site does not refresh anymore.” The blog post did not give a reason for the shutdown, though it did say some of the team’s members will be joining Coinbase, the San Francisco-based crypto exchange.

“Our mission was to bring transparency to the decentralized world, and we believe we made significant progress towards this mission,” the post said. “We built a host of tools that made blockchains easier to understand for our users, and we hope you enjoyed using our data and services as much as we enjoyed building them.”

A Coinbase spokesperson confirmed several members of the TokenAnalyst team would be joining.

“We remain committed and driven towards creating an open financial system for the world and we think that Coinbase is a fantastic place to do that,” the Medium post said.

TokenAnalyst was founded in October 2017, just as the initial coin offering boom and crypto prices surged that year. It had a handful of employees – at least six, according to LinkedIn – including its founders, Jai Prasad and Sid Shekhar. Both joined Coinbase, according to their Twitter biographies.

“It was truly invigorating to tweet/WhatsApp/Telegram/email/Signal 24/7 with crypto enthusiasts from all over the world. It was your incredible support, encouragement and passion that kept us going and motivated,” the blog post said.

Spread the love
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  
  •  

Leave a Reply

Your email address will not be published. Required fields are marked *