- The Federal Reserve Board terminated its enforcement action against Farmington State Bank, which had financial ties to the collapsed FTX cryptocurrency exchange.
- The Fed took action against Farmington in 2022 to wind down operations after it received funds from FTX’s sister company Alameda Research.
- Farmington exited crypto activities and ceased functioning as a bank following the Fed’s enforcement action, prompting the termination of the action in 2023.
The Federal Reserve Board has terminated its enforcement action against Farmington State Bank, a financial institution with ties to the collapsed cryptocurrency exchange FTX.
Farmington Winds Down Operations
In July 2022, the Federal Reserve issued an enforcement action against Farmington State Bank to wind down operations and protect depositors. This came after Farmington received $11.5 million from FTX’s sister company Alameda Research in March 2022.
Following the Fed’s enforcement action, Farmington exited the crypto space and ceased functioning as a bank. With Farmington no longer operating as a bank, the Federal Reserve terminated its enforcement action in February 2023.
The Aftermath of FTX’s Collapse
The failure of FTX in November 2022 prompted increased scrutiny of crypto-linked financial institutions. However, neither the Fed’s enforcement action nor its termination explicitly mentioned FTX or Alameda.
Farmington originally planned to return to its roots as a community bank after divesting from crypto. But the bank was ultimately unable to recover from the fallout of FTX’s implosion. This marks the end of Farmington’s brief foray into the crypto space.
