Fed ends enforcement action into SBF-linked Farmington Bank

The Federal Reserve announced the enforcement action back in August

article-image

Adam Parent/Shutterstock modified by Blockworks

share

The Federal Reserve is ending its enforcement action into the Sam Bankman-Fried linked Farmington Bank.

The announcement came after the Fed said that the Bank had wound down operations and “no longer functions as a bank.”

“The Board’s enforcement action, which has been in effect since July 2023, ensured the bank’s operations would wind down in a manner that protected the bank’s depositors,” a press release said.

When the Fed announced in August that it had taken action against Farmington, it said Farmington had “improperly” changed its business model and failed to inform the central bank. It also named FBH Corporation, its holding company, in the now-terminated enforcement action.

Farmington said, at the time, that it “consented to the Federal Reserve order.”

Read more: Federal Reserve takes enforcement action on Farmington bank, citing stablecoin venture

Farmington, according to the Fed, made a commitment to design the IT infrastructure and work with a third party to “facilitate” the “issuance of stablecoins to the public in exchange for receipt of 50% of mint and burn fees on certain stablecoins.”

The bank operated under the moniker Moonstone Bank for a brief period. It was tied to Alameda and Sam Bankman-Fried, though both were absent from the enforcement action.

Alameda invested $11.5 million into the bank.

Farmington announced last year that it was changing its name back and “discontinuing its pursuit of an innovation-driven business model.” 

The strategy shift, it added, “reflects the impact of recent events in the crypto assets industry and the resultant changing regulatory environment relating to crypto asset businesses.”


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2023

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Cover Vertex.jpg

Research

The proliferation of new perp DEXs has led to fragmented liquidity across various DEXs and chains. Vertex, known for its vertically-integrated DEX that includes spot, perpetual, and integrated money markets, is now tackling cross-chain liquidity fragmentation through horizontal integration with the launch of new Edge instances. Vertex's integrated offerings and cross-margined account structure amplify the benefits of new instances: native cross-chain spot trading, optimized cross-chain basis trading, consistent interest rates, reduced bridging friction, and more.

article-image

Partnering with EtherFi and Angle, the fully on-chain perp DEX features bespoke collateral

article-image

Sponsored

Gavin Wood introduced the next evolutionary step for the Polkadot network: the Join-Accumulate Machine, or JAM

article-image

The side events were the places to be at Consensus 2024, according to attendees

article-image

Also, who’s come out swinging in the spot ether ETF fee war — and who could undercut them

article-image

I know it is not in their nature, but US regulators could learn a lot by researching the digital asset frameworks that overseas regulators have already gotten right

article-image

Also, the ETF hype train can count out at least one member