A group of former executives from the now-defunct, cryptocurrency-friendly Signature Bank has launched a new blockchain-based, state-chartered bank called N3XT, aimed at achieving instant 24-hour payments.
N3XT announced on Thursday that it aims to enable instant settlements at any time through a private blockchain and to provide programmable payments via smart contracts. The company added that its system is designed to be interoperable with stablecoins, functional tokens, and other digital assets.
Scott Shay, the founder of Signature Bank, created N3XT, which will operate under a special purpose depository institution (SPDI) license in Wyoming and will not offer loan services.
Signature Bank was one of three cryptocurrency-friendly banks that collapsed during the 2023 U.S. banking crisis due to a bank run and its association with the rapidly declining cryptocurrency market, alongside Silicon Valley Bank and Silvergate Bank.
The Federal Deposit Insurance Corporation took over Signature Bank in March 2023, just days after the collapse of Silicon Valley Bank, citing its excessive reliance on uninsured deposits, weak risk controls, and an ongoing worsening of deposit withdrawals.
Jeffrey Wallis, the former head of digital assets and Web3 strategy at Signature Bank, will serve as the CEO and president of N3XT, stating that cryptocurrency innovation is at the core of this new venture.
“Money should flow as seamlessly as information,” he said. “We are applying cryptocurrency innovation to banking, providing institutional clients with instant, programmable payments.”
N3XT will not offer loans, and the bank claims its reserves are backed 1:1 by cash or short-term U.S. Treasury securities, promising to share reserve holdings daily.
At launch, N3XT's listed client base includes unnamed businesses across cryptocurrency, foreign exchange, shipping and logistics, and several other sectors.
The bank completed three rounds of funding from multiple investors, including Winklevoss Capital (the venture capital firm of Tyler and Cameron Winklevoss), Paradigm, and HACK VC.
Hack co-founder Alexander Pack stated in a post on the X platform on Thursday that his company is ready to support N3XT and its founders as they emerge from "stealth mode."
“The founders of N3XT, Scott and Jeff, are a force of nature: they previously built Signature Bank in a compliant manner—one of the largest and best supporters of the U.S. cryptocurrency industry—but the last administration forced them to shut down,” he said.
“Most founders would choose to give up after experiencing something like that, but they immediately went back to work and built N3XT,” Pack added.
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Original article: “Former Signature Bank Executives Launch Blockchain-Driven Bank N3XT”
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