Cameron Winklevoss, co-founder, and Chief Executive Officer of the New York-based cryptocurrency exchange Gemini, accused U.S. regulators of employing double standards to manage the First Republic Bank crisis.
Winklevoss claims that if First Republic had been a “crypto bank,” it would have been “assassinated weeks ago.”
Notably, First Republic began experiencing “structural challenges” with its balance sheet around the time Silicon Valley Investment Bank and Silvergate Bank were shut down by federal regulators or ceasing operations.
First Republic Bank is down another 35% and falling fast. If this was a "crypto" bank it would have been assassinated weeks ago. The fact that is hasn't been taken into receivership shows just how blatant the double standard is.
— Cameron Winklevoss (@cameron) April 26, 2023
The claims made by Winklevoss are consistent with a series of recent letters written by three Republican members of the United States House of Representatives Financial Services Committee to obtain additional information on potential coordinated efforts taken against crypto companies operating on U.S. soil.
CNBC reported on April 26 that due to the government’s refusal to take the bank into receivership, First Republic’s advisers will now attempt to persuade larger U.S. banking institutions, which have already sent the troubled firm more than $30 billion, to provide additional financial assistance.
The government placed Silvergate and Silicon Valley Bank into receivership on March 8 and 10, respectively.
According to First Republic advisors, the current private market solution to the company’s liquidity issues would allow the bank to continue operations. Nonetheless, the government receivership is called the “closed-bank” scenario.
Charles Gasparino, a senior correspondent for Fox News, told his 160,000 Twitter followers on April 26 that the “private bailout” is being pushed by U.S. Treasury Secretary Janet Yellen, who, according to Gasparino, does not want to use government funds to bail out depositors, as they did with Silvergate and Silicon Valley Bank.
Scoop: Execs at banks involved in the @firstrepublic imbroglio say latest private sector bailout is actually being pushed by @SecYellen & Co who, unless pushed to the brink, dont want to be bailing out ALL depositors as they did w SVB and Signature. Still a heavy lift. Developing
— Charles Gasparino (@CGasparino) April 26, 2023
First Republic reported in its Q1 earnings call on April 24 that total deposits had plummeted by more than $100 billion, bringing matters to a climax.
The company stated it would “pursue strategic options” to strengthen its financial position as soon as feasible.
Since then, First Republic Bank shares have plummeted by more than 64 percent, plummeting from $16.14 to $5.68 at the time of writing.
First Republic Bank share price since Feb. 2.
As investors develop a growing mistrust of centralized banking institutions, It is believed that the failure of First Republic Bank is providing an impetus for investments in Bitcoin and other cryptocurrencies.
At the time of writing, Bitcoin was trading at $29,279, an increase of 7% over the previous week.