A total of 8 crypto companies cut their partnership with Silvergate Bank, amid spreading negative news about Silvergate’s financial position.
Crypto 2022 was a bad year for the Crypto sector because in that period, many Crypto companies failed, to survive under very high volatility, as they were based on weak business models. Serval crypto companies filed for bankruptcy and left customers with huge losses.
On 1 March 2023, Silvergate announced that the company will take additional 2 weeks for 10K-fillings, the financial report of the company in 2022. Through the annnoucment, Silvergate confirmed that the company expects a huge loss, as many of its partners faced significant losses in 2022. That information by Silvergate resulted in very bad news for the company.
On 2 March, The public crypto exchange Coinbase announced that the exchange will neither accept nor send payments from/to Silvergate Bank.
The Nasdaq-listed company said that all the customers’ funds are secured and customers are free to deposit & withdraw funds with other banking partners. In short bad financial position of Silvergate will not impact Coinbase’s services, as there was very minimum exposure to this bank.
Further Coinbase confirmed that the exchange distanced its services from Silvergate Bank’s banking services.
So far 8 crypto companies reportedly distanced their services from Silvergate Bank and these crypto companies are Circle, Paxos, Crypto.com, Bitstamp, Cboe Digital Markets, Galaxy, and Gemini.
Amid this negative news, the current stock price of Silvergate is down by 57% over the last day’s price.