Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
bitcoin
Bitcoin (BTC) $ 27,204.29
ethereum
Ethereum (ETH) $ 1,904.84
tether
Tether (USDT) $ 1.00
bnb
BNB (BNB) $ 307.03
usd-coin
USD Coin (USDC) $ 1.00
xrp
XRP (XRP) $ 0.525514
staked-ether
Lido Staked Ether (STETH) $ 1,903.07
cardano
Cardano (ADA) $ 0.380802
dogecoin
Dogecoin (DOGE) $ 0.072919
solana
Solana (SOL) $ 21.80
matic-network
Polygon (MATIC) $ 0.902563
tron
TRON (TRX) $ 0.08199
litecoin
Litecoin (LTC) $ 96.35
polkadot
Polkadot (DOT) $ 5.35
binance-usd
Binance USD (BUSD) $ 1.00
shiba-inu
Shiba Inu (SHIB) $ 0.000009
avalanche-2
Avalanche (AVAX) $ 14.77
dai
Dai (DAI) $ 0.999781
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 27,239.30
uniswap
Uniswap (UNI) $ 5.11
chainlink
Chainlink (LINK) $ 6.50
leo-token
LEO Token (LEO) $ 3.60
cosmos
Cosmos Hub (ATOM) $ 10.81
okb
OKB (OKB) $ 46.00
monero
Monero (XMR) $ 150.09
ethereum-classic
Ethereum Classic (ETC) $ 18.24
the-open-network
Toncoin (TON) $ 1.74
stellar
Stellar (XLM) $ 0.092486
bitcoin-cash
Bitcoin Cash (BCH) $ 116.41
internet-computer
Internet Computer (ICP) $ 4.84
filecoin
Filecoin (FIL) $ 4.86
lido-dao
Lido DAO (LDO) $ 2.34
true-usd
TrueUSD (TUSD) $ 1.00
aptos
Aptos (APT) $ 9.22
quant-network
Quant (QNT) $ 117.26
hedera-hashgraph
Hedera (HBAR) $ 0.050726
crypto-com-chain
Cronos (CRO) $ 0.060735
arbitrum
Arbitrum (ARB) $ 1.23
near
NEAR Protocol (NEAR) $ 1.64
vechain
VeChain (VET) $ 0.020033
apecoin
ApeCoin (APE) $ 3.17
the-graph
The Graph (GRT) $ 0.128662
algorand
Algorand (ALGO) $ 0.152833
the-sandbox
The Sandbox (SAND) $ 0.582791
eos
EOS (EOS) $ 0.917986
paxos-standard
Pax Dollar (USDP) $ 1.00
frax
Frax (FRAX) $ 0.999442
render-token
Render (RNDR) $ 2.73
elrond-erd-2
MultiversX (EGLD) $ 38.87
optimism
Optimism (OP) $ 1.51
Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
Hodl Ninjas
Home Markets

Silvergate: Fall of a Premiere Crypto Bank

Silvergate Stock Down by Nearly 40%

Ryan Tinh by Ryan Tinh
January 12, 2023
in Markets, News
0
Silvergate Fall of a Premiere Crypto Bank

What's next for Alan Lane and Silvergate?

Share on FacebookShare on Twitter

The collateral damage from the collapse of FTX is still being felt across the markets as yet another major bank falls prey to the FTX collapse. Sam Bankman-Fried and his cronies are now responsible for yet another teardown of one of the most respected banks in the crypto industry, Silvergate. 

Just this week, Silvergate stock was down by nearly 40% in premarket trading following a business update released on Thursday. In the update, the La Jolla, California company said crypto deposits had dropped to just $3.8 billion in the final three months of last year, compared to almost $12 billion in the prior quarter. 

Following the collapse of FTX and the resulting domino effect of failures across the crypto ecosystem, Silvergate said $150 million of its deposits were from customers that have filed for bankruptcy. 

The News About Silvergate Keeps Getting Worse

“This past year was a much more widespread deleveraging of the ecosystem that obviously culminated with the collapse of FTX,” Alan Lane, chief executive of Silvergate, said on a call following the announcement.

“When you put all of that in context, what we have seen is a lot of institutional players—there’s just been this crisis of confidence.” 

Now the bank has announced that it will lay off 200 employees, roughly 40% of its workforce. In a statement issued to the stock market on Thursday, Silvergate said it had increased headcount “at a rapid rate” last year but now needed to adjust to the “economic realities facing the digital asset industry today.” 

Will The Layoffs Be Enough to Save Silvergate?

The layoffs will cost $8 million to complete, but Lane said it was “too early” to say how much money they would save the company. 

The group will also abandon certain projects, including its plans for a blockchain-based payment solution. The decision means it will take a $196 million write-down on technology it purchased from Meta’s failed Diem project. 

“There are still people on the project,” Lane said in regard to Diem. “As we sit here today, we will obviously have to continue to evaluate.” 

Lane added that in the current operating environment, “it’s going to be really challenging to bring a tokenized dollar… to market anytime soon.

Silvergate had already exited a mortgage warehouse lending business late last year due to rising interest rates and falling mortgage volumes. 

“At this point, we’re not able to comment on whether the first quarter will actually be profitable,”

He described where the company’s deposits will be in the future as a “wild card.” 

Collapsed crypto exchange FTX accounted for around $1 billion of the assets held by Silvergate from digital asset customers by the end of 2022’s third quarter. 

But this did not stop analysts from Morgan Stanley from downgrading their rating on the business last month, as they predicted a slump in deposits amid the FTX fallout.

How Will the Lawsuit Play Out?

The company has also found itself on the receiving end of a class-action lawsuit alleging that it breached its fiduciary duty with respect to deposits made by FTX and its sister firm Alameda Research. Other law firms are also putting together possible legal action. 

“There’s a lot of FUD out there, a lot of misinformation, but we are a regulated financial institution operating in this space for nine years, so we obviously take our responsibility very seriously.”

ShareTweetPin
Previous Post

Will They Lose Robinhood Shares or Keep Them?

Next Post

Celsius Loses Again

Ryan Tinh

Ryan Tinh

Ryan Trinh is a freelance copywriter and content writer located in Los Angeles, California. He is a 2021 UCLA graduate with an English major. He covers the latest crypto headlines for Hodl Ninjas.

Related Articles

Bittrex Officially Files for Bankruptcy
Exchanges

Bittrex Officially Files for Bankruptcy

May 18, 2023
ChatGPT Founder's WorldCoin Becomes Fastest Growing Wallet
Blockchain

ChatGPT Founder’s WorldCoin Becomes Fastest Growing Wallet

May 17, 2023
Binance Suspends Withdrawals
Exchanges

Binance Suspends Withdrawals

May 15, 2023
Founder of Twitter Jack Dorsey Donates $10 Million
Markets

Founder of Twitter Jack Dorsey Donates $10 Million

May 12, 2023
Next Post
Celsius Loses Again

Celsius Loses Again

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Trending Articles

  • High Growth NFT Categories for 2022

    What NFT Categories are Set to Go Ape in 2022?

    0 shares
    Share 0 Tweet 0
bitcoinBitcoin
$ 27,204.29
$ 27,204.29
0.15%
ethereumEthereum
$ 1,904.84
$ 1,904.84
0.05%
tetherTether
$ 1.00
$ 1.00
0.05%
solanaSolana
$ 21.80
$ 21.80
2.69%
cardanoCardano
$ 0.380802
$ 0.380802
1.09%
polkadotPolkadot
$ 5.35
$ 5.35
1.14%

Become a Hodl Ninja.

Stay on top of market trends, find exciting new projects, hold on for dear life.

johnsmith@example.com
© 2021 Hodl Ninjas – A BettorView Brand.
No Result
View All Result
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe

© 2021 Hodl Ninjas - A BettorView Brand.

Search
$ USD
  • $ USD
  • € EUR
  • ₹ INR
0
Previous 25
Next 25
#CoinPriceMarketcapVolume (24h)SupplyChange (24H)Price Graph (7D)
Previous 25
Next 25
Subscribe to Hodl Ninjas

Get the latest news in crypto and be the first to hear about exciting new projects.

Enter your email address

No thanks, I’m not interested.