At 4:30 PM Eastern Time, Silvergate Bank announced its intention to wind down the crypto-friendly bank’s operations and voluntarily liquidate the company’s assets. The news follows significant financial problems the bank faced, and the company’s shares fell in value.
Details of Silvergate’s liquidation and decommissioning plan
Over the past six months, Silvergate Capital Corporation’s (NYSE: SI ) stock fell 94.82% against the US dollar as the company faced significant financial issues related to its exposure to the now-defunct crypto exchange FTX. On Wednesday March 8, 2023, the company announced that it was winding down operations and plans to liquidate the bank. Four days ago, Silvergate discontinued the firm’s Silvergate Exchange Network payment platform.
“In light of the latest developments in the industry and the regulations, Silvergate believes that an orderly liquidation of the banking business and a voluntary liquidation of the bank is the best way forward,” the company’s press release states. “The bank’s liquidation and liquidation plan includes full repayment of all deposits. The company is also evaluating how best to resolve claims and preserve the residual value of its assets, including its proprietary technology and tax assets, Silvergate’s statement said.
Silvergate’s stock closed Wednesday at $4.91 per share after the stock fell 40.99% in USD value over the past five days. Last week, it told the US Securities and Exchange Commission (SEC) it had to delay its annual fiscal earnings report, and the bank’s stock was downgraded by banking giant JPMorgan. In the filing, Silvergate cited its “ability to continue as a going concern,” and it also noted that it faced regulatory scrutiny from U.S. officials. Following the stock downgrade, major crypto firms such as Circle, Crypto.com, Gemini, Paxos and Coinbase distanced themselves from the crypto-friendly bank.
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asset preservation, banking, banking giant JPMorgan, Circle, Coinbase, crypto exchange FTX, crypto-friendly banking, Crypto.com, deposit refunds, financial issues, Gemini, industry development, major crypto firms, liquidation plan, Paxos, payment platform, proprietary technology, regulatory scrutiny, residual value, SEC , SI , SI stock , Silvergate Bank , Silvergate Capital Corporation , stock downgrade , tax benefit , US Securities and Exchange Commission , USD value , voluntary liquidation , liquidation plan
What impact will the voluntary liquidation of Silvergate Bank have on the broader cryptocurrency industry? Share your thoughts on this topic in the comments section below.
Jamie Redman
Jamie Redman is the news editor at Bitcoin.com News and a financial technology journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open source and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.
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