Once a major banking partner for various cryptocurrency companies, Silvergate will end its operations in accordance with regulatory requirements.
In a press release shared on Wednesday, Silvergate Capital Corporation, the holding company of Silvergate Bank, announced the immediate closure of the bank’s operations as well as the voluntary liquidation of the bank.
“In light of recent industry and regulatory developments, Silvergate believes that an orderly liquidation of the Bank’s operations and a voluntary liquidation of the Bank is the best course of action,” said the Press release States. The liquidation process will include the full repayment of all deposits.
Silvergate Bank will also discontinue the Silvergate Exchange Network (SEN), which it previously announced on March 3, 2023 on its website. According to the press release, all other deposit-related services remain operational.
Centerview Partners LLC will act as financial advisor to the bank, Cravath, Swaine & Moore LLP will act as legal advisor, and Strategic Risk Associates will provide transition project management assistance.
Just yesterday, Bitcoin Magazine PRO’s Dylan LeClair detailed the reason behind the sudden crash, writing that “Silvergate’s stock price does not implode due to the performance of a crypto token as it did the case for many companies during the crypto winter of 2022, but rather an exodus of deposits that forced the company to liquidate long-lived securities at a loss in order to stay liquid. He goes on to explain the fractional reserve and lending system which obviously led to the downfall of the bank.
