On March 2, 2023, cryptocurrency exchange Coinbase announced that, in light of recent developments, the company “no longer accepts or initiates payments to or from Silvergate Bank.” The news follows the crypto bank’s delay of its annual 10-K filing with the US Securities and Exchange Commission (SEC) and JPMorgan’s downgrade of the company’s shares from “neutral” to “underweight.”
Coinbase cuts ties with Silvergate Bank, company shares expected to be highly volatile after recent events
Coinbase announced Thursday that it is no longer accepting or initiating any payments to or from Silvergate bank, which supports cryptocurrency. Silvergate recently delayed its fiscal year 2022 10-K filing with the SEC, citing the need for more time to complete the filing. After the delay, the financial entity JPMorgan degraded shares of the company from “neutral” to “underweight”.
Before the opening bell on Wall Street on Thursday morning, silvergate shares it had fallen 17.20% in value in the last five days. At 8:23 a.m. Eastern Time, Coinbase made its announcement. “At Coinbase, all customer funds continue to be secure, accessible and available,” the company said. tweeted. “In light of recent developments and out of an abundance of caution, Coinbase is no longer accepting or initiating payments to or from Silvergate.”
While further noting that funds held on Coinbase are safe, the company aggregate:
Coinbase has minimal corporate exposure to Silvergate.
JPMorgan downgrade and Coinbase Silvergate announcement come amidst reports that crypto derivatives platform Ledgerx has informed clients that it no longer works with Silvergate. The alleged email sent by Ledgerx to clients indicates that bank transfers will now be made through Signature Bank.
Although Ledgerx was once part of the FTX company, it is now one of the subsidiaries that are not involved in the FTX bankruptcy process. Hours before the Coinbase announcement, CNBC reported Silvergate shares were expected to be one of the most active during the trading session on Thursday.
What impact do you think the recent developments involving Silvergate Bank will have on the cryptocurrency market as a whole? Share your thoughts on this topic in the comments section below.
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