A collective of former executives from the defunct crypto-centric Signature Bank has established a new blockchain-based, state-chartered bank called N3XT, aiming to facilitate instant 24/7 payments.
N3XT announced on Thursday its ambition to allow for immediate payments at any time via a private blockchain, as well as to provide programmable payments through smart contracts. The company also stated that its infrastructure is created for interoperability with stablecoins, utility tokens, and various other digital assets.
Scott Shay, the original founder of Signature Bank, has established N3XT, which will function under a Wyoming Special Purpose Depository Institution (SPDI) charter and will not provide lending services.
Signature Bank was among three crypto-adjacent banks, alongside Silicon Valley Bank and Silvergate Bank, that fell during the 2023 US banking crisis due to a bank run and associations with the rapidly declining crypto market.
The Federal Deposit Insurance Corporation took over Signature Bank in March 2023, shortly after Silicon Valley Bank’s collapse, citing excessive reliance on uninsured deposits, inadequate risk controls, and a worsening deposit run.
N3XT Not Offering Lending Services
Jeffrey Wallis, Signature Bank’s former director of digital asset and Web3 strategy, will serve as the CEO and president of N3XT and emphasized that crypto innovations are central to this new endeavor.
“Money should move as seamlessly as information,” he stated. “We’re leveraging crypto innovations in banking to provide instant, programmable payments for institutional clients.”
N3XT will not engage in lending and claims its reserves are backed one-to-one by cash or short-term US Treasuries, with a commitment to share reserve holdings daily.
At its inception, N3XT identifies its client base as unspecified businesses across crypto, foreign exchange, shipping and logistics, and various other industries.
Backed by Crypto Venture Capital Firms
The bank secured three rounds of financing from a diverse group of investors, including Winklevoss Capital, the venture capital firm of Tyler and Cameron Winklevoss, Paradigm, and HACK VC.
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Alexander Pack, co-founder of Hack, remarked in a post on X that his firm is ready to support N3XT and its founders as they come out of “stealth mode.”
“N3XT’s founders, Scott and Jeff, are forces of nature: they previously built Signature Bank, the largest and most reputable bank supporting the US crypto industry in a regulated manner, before the previous administration forced them to shut down,” he mentioned.
“Most founders would walk away after such an event, but instead, they went right back to work to establish N3XT,” Pack concluded.
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