The Swiss Financial Market Supervision Authority (FINMA) has launched bankruptcy proceedings against the local online bank FlowBank.
#FINMA eröffnet Konkurs über die FlowBank SA: https://t.co/DGxN8mzde5
Informationen zum Konkursverfahren stellt die FINMA auf ihrer Webseite zur Verfügung: https://t.co/S00N1ASeVo pic.twitter.com/NkCOi88mB3
"This measure has become necessary because the bank no longer has the minimum capital needed to run a business. There are also concerns that the bank is over-indebted. The purpose of the bankruptcy procedure is to protect depositors," the message says.
According to FINMA, the management of the institution failed to take steps to solve the problems.
Representatives of the regulator did not see any prospects for restructuring and stated the need to liquidate FlowBank. The procedure will be handled by the law firm Walder Wyss AG.
The bank has been operating since 2020 and offered cryptocurrency trading services. He was a partner of Techteryx, the issuer of the TrueUSD stablecoin. In March 2023, the latter was already facing problems due to the closure of Signature Bank.
In 2022, CoinShares, a digital asset management company, acquired a 20.8% stake in FlowBank for CHF 24.74 million (~$26.5 million at that time). Together with previous strategic investments made in October 2021, the firm increased the bank's stake to 29.3% with a voting share of 32.06%.
Binance used the services of FlowBank. In the comments Bloomberg the head of the crypto exchange, Richard Teng, said that the Swiss institution "has very few assets."
Recall that in August 2023, cryptocastodian Prime Trust filed for bankruptcy in accordance with Chapter 11 of the US Code in a Delaware court.