A rural Washington-based bank with extensive ties to FTX is closing its clients’ crypto accounts, Forbes reported Jan. 19.
Forbes stated that, based on communications that it has obtained, Moonstone is informing clients that it plans to close those accounts. Moonstone has reportedly asked clients to end their transactions and move their funds to another institution.
The company has just a few dozen crypto customers, according to today’s report. The account closures do not seem to extend to traditional accounts.
Following Forbes’ report, Moonstone officially announced that it plans to stop providing crypto services. Despite its high-value dealings with FTX, the bank’s physical location is incredibly small and nondescript; as such, the firm says that it will serve as a community bank and rebrand under its former name, Farmington State Bank.
Forbes noted that Moonstone did not explicitly state that the account closures are linked to FTX’s collapse. However, the company alluded to “recent events in the crypto assets industry.”
Moonstone itself had direct ties to FTX and Alameda Research. Most notably, it received an $11.5 million investment from Alameda in January 2022.
The bank’s owners had further dealings with FTX. Jean Chalopin, chairman of Deltec Bank & Trust, acquired Moonstone in 2020 in order to turn the company into a crypto-focused bank. In addition to arranging the Almeda investment, Chalopin obtained a $50 million loan from Norton Hall Ltd. — a firm connected to FTX DM co-CEO Ryan Salame. FTX and Chalopin otherwise maintained a close relationship, Forbes suggests.
FTX also stored $50 million of deposits in two accounts at Moonstone at one point.
Moonstone is just one bank impacted by FTX’s failure. Silvergate Bank, Signature Bank, and Metropolitan Commercial Bank all seem to have been affected by the collapse — though some have been affected to a greater extent than others.