A financial services company involved with banking and digital assets, FairX closes down its operations citing the failure to establish a licensed national bank, as per FairX Twitter thread on July 19.
Reportedly, the company has failed to set a licensed national bank due to a lack of funding. FairX has been trying to raise funds for the planned bank over the past 14 months, described as:
“… a new, licensed, fully regulated national bank, modeled as a financial market utility, that would work with individuals and banks to create a dematerialized bank deposit, denominated in USD. The bank was Frank Financial.”
The posts further explained:
“This dematerialized bank deposit would act, in many respects, similarly to stablecoin, except a stablecoin this was not. A stablecoin, by its definition, is not an asset that can settle transactions between banks in the context of, say, ACH [automated clearing house] or CC [credit card] transactions.”
The company went on to stress over its success in introducing its business idea to regulators, complying with Know Your Customer, Anti-Money Laundering and counter-terrorism financing rules, as well as in receiving positive feedback from regulators. Though in its binary stage, FairX needed needed another injection of capital. At that point, the crypto investment community backed out purportedly due to the bank’s perceived centralization.
Image source – Stock Photo Secrets
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