- Silvergate Capital, a major financier of the crypto industry, announced that it will be shutting down its banking services and liquidating its assets. The news caused its stock to drop more than 36% in after-hours trading. Silvergate was one of the two main banks for crypto companies, with the other being New York-based Signature Bank, which has over $114 billion in assets in comparison to Silvergate's $11 billion. Bankrupt crypto exchange, FTX, was one of Silvergate's major customers.
- All deposits will be reimbursed in full in accordance with a liquidation strategy. The organization did not provide details on how they intend to handle claims made against them. Investment firms Citadel Securities and BlackRock recently took major stakes in Silvergate, buying up 5.5% and 7%, respectively.
Why it matters
Less than a week after Silvergate ceased operations of its payments platform, the Silvergate Exchange Network (SEN), the company announced its liquidation. Other deposit-associated services are still active as Silvergate wraps up its business, and customers will be advised should there be any new developments.