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Silvergate Capital, the parent company to what was once the single largest crypto banking partner, Silvergate Bank, has finally been delisted from the New York Stock Exchange (NYSE) and begun the liquidation process.
California-based Silvergate first IPOed on the NYSE in June 2019 for $12/share, rocketing to an all-time high of almost $240/share in November 2021. Today, a share of Silvergate Capital Corp trades for less than $1 on OTC Markets. The delisting was confirmed on May 11, 2023, with over 200 employees being let go and all assets set to be liquidated by November.
Deposits and funds from FTX that were stored at Silvergate were seized in January of this year, and with losses mounting from fleeing depositors, Silvergate CEO Alan Lane decided to voluntarily wind up the bank.
Desperate attempts to save Silvergate
Before the closure of the go-to crypto bank, numerous attempts were made to salvage it: Brendan Blumer — an EOS and Block.One co-founder — dumped tens of millions of dollars into the bank, buying almost 10% of total ownership late last year. Citadel and Cathie Wood’s ARK Invest also purchased millions of dollars worth of shares, and millions in advances from the Federal Home Loan Banks (FHLB) were taken out by Silvergate.
None of the cash infusions were able to save the floundering financial institution.
Federal Home Loan Banks are bailing out crypto
Read more: Why is Silvergate Bank still listed on the NYSE?
The beginning of the end
The same day that Silvergate Capital announced its delisting from the NYSE, OTC Markets (where Silvergate shares are now traded) released an article about how disclosures will be key to the future of cryptocurrency — both calling out Washington and the SEC for failure to clarify “regulations and advance comprehensive legislation” and acknowledging that proper disclosures from individuals and companies in the crypto space are few and far between.
Silvergate’s disintegration seemingly set off a slew of regional bank failures on the West Coast, from Silicon Valley Bank to Signature Bank. Indeed, reverberations were still being felt at the beginning of May when First Republic was closed and taken over by the Federal Deposit Insurance Corporation.
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