At 4:30 p.m. ET, Silvergate Bank announced its intention to liquidate the crypto bank’s operations and voluntarily liquidate the company’s assets. The news follows significant financial problems the bank faced, with the company’s share value plummeting.
Silvergate Reduction and Settlement Plan Details
In the past six months, Silvergate Capital Corporation (NYSE: AND) shares fell 94.82% against the US dollar, as the company faced significant financial problems related to its exposure to the now-defunct cryptocurrency exchange FTX. On Wednesday, March 8, 2023, the company announced that it would close its operations and plans to liquidate the bank. Four days ago, Silvergate discontinued the firm’s Silvergate Exchange Network payment platform.
“In light of recent industry and regulatory developments, Silvergate believes that an orderly winding down of banking operations and a voluntary liquidation of the bank is the best way forward,” the company said. Press release detailed. “The bank’s reduction and liquidation plan includes the full refund of all deposits. The company is also considering how best to resolve the claims and preserve the residual value of its assets, including its proprietary technology and tax assets,” the Silvergate statement added.
Silvergate shares closed on Wednesday at $4.91 per share after the shares fell 40.99% in USD value over the past five days. Last week, he told the US Securities and Exchange Commission (SEC) that he had to delay his annual fiscal earnings report, and banking giant JPMorgan downgraded the bank’s shares. In the filing, Silvergate mentioned its “ability to continue as a going concern” and also noted that it faced regulatory scrutiny from US officials. After the stock downgrade, big crypto firms like Circle, Crypto.com, Gemini, Paxos, and Coinbase distanced themselves from the crypto-friendly bank.
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.
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