Coinbase CEO Considers Adding Banking Features Amid Silicon Valley Bank Turmoil

The cryptocurrency industry has been rocked by the closure of three major American banks, including Silicon Valley Bank (SVB), which has traditionally served startups across several innovation sector industries.

The closure of SVB was particularly devastating, as USD Coin (USDC) issuer Circle had over $3.3 billion of its $40 billion reserves locked up in the bank.

The news caused shockwaves through the industry, with the USDC stablecoin briefly losing its $1 peg. Given the tumult of the past few days, the cryptocurrency ecosystem is now taking a closer look at ties to traditional finance institutions that serve fiat currency deposits, withdrawals, and monetary flows.

Coinbase CEO Brian Armstrong took to Twitter on March 13, saying the American cryptocurrency exchange has previously considered features that could potentially bypass or serve to bridge gaps exposed in the latest mainstream banking failure.

Armstrong also opened the door for comments in the thread, saying that Coinbase would need to add a few more features like outbound wires, multi-user support, etc., before offering neobanking services to high-net-worth individuals and businesses.

Coinbase confirmed that it had around $240 million held at Signature Bank on March 10 but expects to recover all of its cash holdings.