Silvergate Bankcornerstone in the world crypto, announced its closure and the return of deposits to users. The decision comes due to “recent developments in the sector and in the regulation”.
Silvergate, a pillar of the crypto world collapses
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In a press release, the parent company of the bank, Silvergate Capital Corporation, he declared that he took this decision due to the general trend of the sector and the regulations on the subject.
The company has long seemed to be in trouble, like its most important customers FTX and Genesis. In January, the earnings report revealed that it had lost a billion dollars in one quarter after the withdrawal of $8.1 billion from its customers. On March 1, he filed a paper saying his financial situation was even worse.
Without Silvergate, the fear is that the Cryptocurrency firms may turn to less regulated institutions for their banking needs. Something that could make the situation more dangerous for investors.
Silvergate is now winding down customers “in an orderly manner and in accordance with applicable regulatory processes”. Meanwhile, she closed hers Silvergate Exchange Networkwhich allowed cryptocurrency exchanges such as Coinbase, Gemini and Kraken.
Meanwhile, companies like Coinbase, Crypto.com and Paxos they started walking away from the bank. Even the stablecoin Tether he took the opportunity to distance himself from the institution.
At the moment, it does not appear that financial risk can spread to the rest of the economy as well. But the problems that various crypto-related realities are having are worrying investors.