As soon as a significant banking accomplice for varied cryptocurrency corporations, Silvergate will finish its operations consistent with regulatory necessities.
In a press launch shared on Wednesday, Silvergate Capital Company, the holding firm for Silvergate Financial institution, introduced the quick winding down of the financial institution’s operations together with voluntary liquidation of the financial institution.
“In mild of latest trade and regulatory developments, Silvergate believes that an orderly wind down of Financial institution operations and a voluntary liquidation of the Financial institution is one of the best path ahead,” the press release states. The wind down course of will embody full reimbursement of all deposits.
Silvergate Financial institution may also discontinue the Silvergate Alternate Community (SEN), which it introduced beforehand on March 3, 2023 on its web site. In accordance with the press launch, all different deposit-related providers stay operational.
Centerview Companions LLC will act because the financial institution’s monetary advisor, Cravath, Swaine & Moore LLP will act as its authorized advisor, and Strategic Threat Associates will present transition venture administration help.
Simply yesterday, Bitcoin Journal PRO’s Dylan LeClair detailed the reason for this sudden collapse, writing that “Silvergate’s share worth isn’t imploding due the efficiency of a crypto token as was the case for a lot of corporations within the crypto winter of 2022, however fairly from a deposit exodus that has compelled the agency to liquidate long-duration securities at a loss with a purpose to stay liquid.” He goes on to elucidate the fractional reserve and lending system that evidently has led to the downfall of the financial institution.
