US regulators have shut down Republic First Bank, headquartered in Philadelphia, marking the inaugural banking collapse of 2024 in the nation.
The closure has ignited discussions within the crypto community as Bitcoin (BTC) prices dip to $62,935, Ether (ETH) sees a decline to $3,115, and various altcoins experience slight setbacks in response to the news.
“In light of Republic First Bank’s collapse, I’ll remain committed to Bitcoin,” remarked Zesh Marius Martocsan, CEO, in a post dated April 26 on X.
“Republic First Bank’s collapse warrants attention as bank failures provide a compelling narrative for crypto,” asserted Pillage Capital, a pseudonymous crypto trader, in a post dated April 26 on X.
“On April 26, crypto commentator Randi Hipper questioned her 87,100 X followers, ‘How many more banks must fail before people begin to act as their own bank?'”
Following the seizure of Republic First by the Pennsylvania Department of Banking and Securities on April 26, the Federal Deposit Insurance Corporation (FDIC) was designated as its receiver.
As per an April 26 statement released by the FDIC, the agency will assume nearly all deposits and take possession of all assets of Republic Bank.
As of January 31, Republic First held around $6 billion in total assets and $4 billion in total deposits.
Additionally, its 32 branches spanning New Jersey, Pennsylvania, and New York are slated to reopen under Fulton Bank’s management by the beginning of next week at the latest.
In 2023, mere speculations of potential banking failures led to minor upticks in Bitcoin’s price shortly thereafter. However, this time, Bitcoin’s price has experienced a slight decline in the wake of the news.
According to CoinMarketCap data, in the past hour, Bitcoin has dropped by 1.16%, trading at $62,715, while Ether has decreased by 0.58%, trading at $3,095.
During the same period, altcoins have experienced a slightly more significant decline, with Dogecoin (DOGE) dropping by 2.88% to $0.15, and Solana (SOL) decreasing by 1.79% to $136.
This news arrives after a challenging year for the banking sector, with the FDIC reporting five banking failures in the United States in 2023.
In May 2023, First Republic Bank, an independent entity unrelated to Republic First, was acquired by JPMorgan after initial attempts at recovery proved futile.
March 2023 witnessed the Federal Reserve’s announcement of the closure of Signature Bank, citing the need to safeguard the U.S. economy and referencing “systemic risk.”
This decision came shortly after the order for Silicon Valley Bank to cease operations. Additionally, a week prior, Silvergate Bank, recognized for its crypto-friendly stance, declared its closure and intention to undergo voluntary liquidation.
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