• Tech News
    • Games
    • Pc & Laptop
    • Mobile Tech
    • Ar & Vr
    • Security
  • Startup
    • Fintech
  • Reviews
  • How To
What's Hot

Elementor #32036

January 24, 2025

The Redmi Note 13 is a bigger downgrade compared to the 5G model than you might think

April 18, 2024

Xiaomi Redmi Watch 4 is a budget smartwatch with a premium look and feel

April 16, 2024
Facebook Twitter Instagram
  • Contact
  • Privacy Policy
  • Terms & Conditions
Facebook Twitter Instagram Pinterest VKontakte
Behind The ScreenBehind The Screen
  • Tech News
    1. Games
    2. Pc & Laptop
    3. Mobile Tech
    4. Ar & Vr
    5. Security
    6. View All

    Bring Elden Ring to the table with the upcoming board game adaptation

    September 19, 2022

    ONI: Road to be the Mightiest Oni reveals its opening movie

    September 19, 2022

    GTA 6 images and footage allegedly leak

    September 19, 2022

    Wild west adventure Card Cowboy turns cards into weird and silly stories

    September 18, 2022

    7 Reasons Why You Should Study PHP Programming Language

    October 19, 2022

    Logitech MX Master 3S and MX Keys Combo for Business Gen 2 Review

    October 9, 2022

    Lenovo ThinkPad X1 Carbon Gen10 Review

    September 18, 2022

    Lenovo IdeaPad 5i Chromebook, 16-inch+120Hz

    September 3, 2022

    It’s 2023 and Spotify Still Can’t Say When AirPlay 2 Support Will Arrive

    April 4, 2023

    YouTube adds very convenient iPhone homescreen widgets

    October 15, 2022

    Google finishes iOS 16 Lock Screen widgets rollout w/ Maps

    October 14, 2022

    Is Apple actually turning iMessage into AIM or is this sketchy redesign rumor for laughs?

    October 14, 2022

    MeetKai launches AI-powered metaverse, starting with a billboard in Times Square

    August 10, 2022

    The DeanBeat: RP1 simulates putting 4,000 people together in a single metaverse plaza

    August 10, 2022

    Improving the customer experience with virtual and augmented reality

    August 10, 2022

    Why the metaverse won’t fall to Clubhouse’s fate

    August 10, 2022

    How Apple privacy changes have forced social media marketing to evolve

    October 16, 2022

    Microsoft Patch Tuesday October Fixed 85 Vulnerabilities – Latest Hacking News

    October 16, 2022

    Decentralization and KYC compliance: Critical concepts in sovereign policy

    October 15, 2022

    What Thoma Bravo’s latest acquisition reveals about identity management

    October 14, 2022

    What is a Service Robot? The vision of an intelligent service application is possible.

    November 7, 2022

    Tom Brady just chucked another Microsoft Surface tablet

    September 18, 2022

    The best AIO coolers for your PC in 2022

    September 18, 2022

    YC’s Michael Seibel clarifies some misconceptions about the accelerator • DailyTech

    September 18, 2022
  • Startup
    • Fintech
  • Reviews
  • How To
Behind The ScreenBehind The Screen
Home»Startup»Bank downplays ties to FTX sister company in latest fallout from crypto exchange failure – Startup
Startup

Bank downplays ties to FTX sister company in latest fallout from crypto exchange failure – Startup

November 30, 2022No Comments6 Mins Read
Facebook Twitter Pinterest LinkedIn Tumblr Email
Bank downplays ties to FTX sister company in latest fallout from crypto exchange failure – GeekWire
Share
Facebook Twitter LinkedIn Pinterest Email
(Bigstock Image)

A bank in rural Washington state sought to distance itself from FTX on Tuesday following a report last week detailing its connections to the failed cryptocurrency exchange.

Moonstone Bank, formerly known as Farmington State Bank, said in a statement that FTX founder Sam Bankman-Fried’s Alameda Research trading firm has less than a 10% stake in its parent company, with no board seats and no direct involvement in management.

The New York Times reported Nov. 23 that FBH, the parent company of Farmington State Bank, received $11.5 million in venture capital funding in March from Alameda, the trading firm whose financial struggles have been cited as a key factor in FTX’s demise. The swift collapse of FTX earlier this month sent a contagion through the crypto industry.

“In January this year, as a result of a capital raise effort to support our further development, we received an investment from a company that at the time had a pristine reputation and was a darling of the financial markets,” Moonstone said in a statement Tuesday, referring to Alameda Research.

“Unfortunately,” the statement continued, “the unexpected collapse of this company negatively impacted countless individual investors, investment firms, vendors, counterparties and unfairly affected Farmington State Bank d.b.a Moonstone Bank’s reputation as well.”

Farmington State Bank has its origins in the tiny town of Farmington, Wash., near the Washington-Idaho border. The lender, founded in 1887, previously provided agriculture-focused loans.

It was acquired in 2020 by FBH Corporation, owned by Jean Chalopin, also the chairman of Bahamas-based Deltec Bank. Deltec’s most well-known client is Tether, a crypto company with $65 billion in assets.

Farmington State Bank changed its name just before the FTX investment. Moonstone now describes itself as a “chartered digital bank,” employs several people in the Seattle region and is based in Bellevue, Wash., according to its LinkedIn page.

See also  10 Ways To Secure A Mentor And Grow As An Entrepreneur

Before it started raising capital to transform into a tech-focused bank, Farmington had just three staff members and was the 26th-smallest bank in the U.S. out of 4,800, The New York Times reported. Its net worth was $5.7 million, according to the Federal Deposit Insurance Corporation, and it did not offer online banking or credit cards.

The Times reported that in the third quarter this year, the bank’s deposits grew nearly 600% to $84 million. A majority of the increase came from four new accounts, according to the Times.

By acquiring Farmington, Moonstone received a banking charter, a business license required for financial institutions handling deposits and offering other bank-like services. Obtaining a banking charter can be a difficult process for many fintech companies.

Asked why Farmington State Bank specifically was a target for acquisition, Moonstone’s chief digital officer Janvier Chalopin told Startup that Moonstone was looking for a U.S. bank. Farmington had a clean balance sheet and was seeking a buyer, he said.

“It was just a match made in heaven,” he said in an interview Tuesday, speaking from the Bahamas. Janvier Chalopin is the son of Jean Chalopin.

RELATED: ‘This too shall pass’: Why crypto leaders are still optimistic about the industry amid FTX fallout

Banking experts interviewed for this story said fintech companies buying up older banks and obtaining charters is uncommon but not unprecedented. Notable examples include Lending Club acquiring Radius Bank and SoFi purchasing then-Golden Pacific Bancorp.

However, bank transactions require a significant amount of due diligence from regulators. Given that Moonstone was partly owned offshore and was involved in crypto, the deal should have raised more regulatory flags, experts said.

See also  Fred Hutch spinout lands $10M for precision test to guide cancer treatment, develop drugs – Startup

“At Alameda Research, we are committed to growing the industry and supporting businesses that are creating real change,” said Ramnik Arora, one of Bankman-Fried’s top lieutenants who resigned last month, in a press release announcing Alameda’s investment in FBH.

As for how Moonstone will be affected by the FTX bankruptcy process, Chalopin said “the bankruptcy court would own the equity now and it would likely go through an auction process for people to bid on.”

Moonstone aims to serve both consumers and businesses with a digital-first banking model. For individuals, its goal is to develop a “one-stop-shop” where consumers can purchase stocks and digital assets from the same place as their checking account, Chalopin said. On the business side, it plans to work with small-to-medium sized businesses that struggle to open bank accounts elsewhere, such as cannabis companies and digital asset startups.

It also plans to offer a “banking-as-a-service” model to financial services companies to allow them to have the “proper banking structure for their accounts,” Chalopin said.

“What we’ve innovated on is the risk and compliance and the tech stack to support the monitoring and the ledgering of those accounts,” he added.

The bank now has 32 employees, including 16 that live in Washington state. The company maintains an “in-person customer interfacing branch,” according to a statement.

Moonstone had a post-money valuation of approximately $115 million at the time of the Alameda investment, according to Chalopin, who said this is a common valuation for a bank with this “kind of business model.”

He said Moonstone is now more analogous to a startup than a centuries-old bank. “It’s a startup because we’re raising capital, we’re hiring a team, and we have big growth plans,” he said. “We’re burning cash to create something new.”

See also  Conspiracy Theorists Are Coming for the 15-Minute City

The company is still technically headquartered in Farmington, Wash., Chalopin said, but it is looking for long-term space in Bellevue, just east of Seattle.

Moonstone is led by CEO Gary Rever, who is a director at Vermont State Bank. It was previously led by Ron Oliveira, who departed the CEO position in August.

Moonstone’s chief legal officer is Joseph Vincent, a former adjunct law professor in financial Institutions and fintech at Seattle University. He represented Moonstone as a panelist at the TF6 conference in June, a crypto event hosted by Seattle crypto accelerator TF Labs.

Praful Mainker is the company’s chief compliance officer. He previously worked as an executive director at J.P. Morgan Chase. He is joined by CTO Daniel Ranallo, a former software engineering leader at Ray Dalio’s Principles.

Noah Perlman, who is the COO of major digital-asset exchange Gemini, is a member on Moonstone’s board of directors. Gemini recently announced plans to expand in Seattle.

FTX has a connection to another Seattle-area company: last year, its venture arm participated in a $70 million round in Seattle-based Protego Trust Bank, a crypto bank that was granted a conditional banking charter in February 2021.



Source link

bank Company Crypto downplays exchange failure Fallout FTX latest sister Startup ties
Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

Related Posts

Multiple Milestones As New Majority Capital Boosts Entrepreneurship Through Acquisition

September 26, 2023

Getty Images Plunges Into the Generative AI Pool

September 26, 2023

3 Hot Startup Opportunities In Augmented Reality

September 26, 2023

The ChatGPT App Can Now Talk to You—and Look Into Your Life

September 25, 2023
Add A Comment

Comments are closed.

Editors Picks

CA truckers protest AB5 ‘gig employee’ legislation, provide chain woes worsen

July 19, 2022

Stop telling clients to pay ransomware gangs, solicitors told

July 9, 2022

Xiaomi Redmi Note 13 5G review

March 7, 2024

Samsung Galaxy A54 5G review

April 5, 2023

Subscribe to Updates

Get the latest news and Updates from Behind The Scene about Tech, Startup and more.

Top Post

Elementor #32036

The Redmi Note 13 is a bigger downgrade compared to the 5G model than you might think

Xiaomi Redmi Watch 4 is a budget smartwatch with a premium look and feel

Behind The Screen
Facebook Twitter Instagram Pinterest Vimeo YouTube
  • Contact
  • Privacy Policy
  • Terms & Conditions
© 2025 behindthescreen.uk - All rights reserved.

Type above and press Enter to search. Press Esc to cancel.