A group of former executives from Signature Bank, the crypto-friendly bank closed in March 2023, announced on Thursday the launch of a new blockchain-powered full reserve bank, aiming to offer programmable US dollar payments.
Dubbed N3XT, the bank operates under Wyoming’s Special Purpose Depository Institution (SPDI) charter, settles payments instantly using a private blockchain system, and allows businesses to automate transactions via smart contracts.
Unlike traditional banks, N3XT does not lend deposits. Instead, it is a “narrow bank” where each dollar is backed one-for-one by cash or short-term U.S. Treasury bills and is disclosed daily.
At the helm is CEO and President Jeffrey Wallis, former director of digital asset strategy at Signature Bank. Scott Shay, co-founder of Signature and creator of its crypto payments platform Signet, is also the founder of N3XT.
The company is backed by venture capital firms including Paradigm, HACK VC and Winklevoss Capital – the venture capital firm of crypto exchange founders Gemini, Tyler and Cameron Winklevoss – among others. The company has raised $72 million in three funding rounds, most recently in October, according to Crunchbase data.
The move comes more than two years after state regulators shut down Signature Bank in March 2023, just days after the collapse of Silicon Valley Bank. The Federal Deposit Insurance Corp. had then cited Signature’s over-reliance on uninsured deposits and weak risk controls as the main reasons for the closure. Signature Bank’s key offering was Signet, a real-time payments platform popular with crypto businesses.
N3XT said it aimed to offer a service similar to that once provided by Signet. Its architecture is designed to be programmable and compliant, allowing businesses to automate financial operations such as supplier payments or collateral adjustments without the need to wait for traditional bank hours.
“We are applying crypto innovations to the banking industry to deliver instant, programmable payments to institutional clients,” Jeffrey Wallis said in a statement. “Our platform gives businesses the control and reliability they need in a 24/7 global economy.”
The company already has clients in sectors such as crypto, shipping and logistics, foreign exchange with a “robust pipeline” of inbound clients, the bank said.
