Silvergate Bank Announces Voluntary Liquidation as Crypto Industry Woes Persist – Silvergate Capital Corporation (NYSE: SI) stock fell 94.82% against the U.S. dollar during the past six months as the company experienced severe financial difficulties due to its exposure to the failed cryptocurrency exchange FTX.
The firm declared it was closing down and liquidating the bank on March 8, 2023. Silvergate’s Silvergate Exchange Network payment system was discontinued four days ago. “In light of recent industry and regulatory developments, Silvergate believes that an orderly wind down of bank operations and a voluntary liquidation of the bank is the best path forward,” the company’s press release detailed.
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“The bank’s wind down and liquidation plan includes full repayment of all deposits. The company is also considering how best to resolve claims and preserve the residual value of its assets, including its proprietary technology and tax assets,” Silvergate’s statement added.
On Wednesday, stocks of Silvergate finished at $4.91 USD, down 40.99% from their peak value. JPMorgan, the world’s largest bank, lowered the bank’s stock last week after it informed the U.S. Securities and Exchange Commission (SEC) that it would be postponing its annual fiscal earnings report.
Silvergate acknowledged the regulatory scrutiny it faced in the United States and its “ability to continue as a going concern” in the filing. Major cryptocurrency companies including Circle, Crypto.com, Gemini, Paxos, and Coinbase also distanced themselves from the cryptocurrency-friendly bank after the stock downgrade.
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