- The firm delayed the publishing of its annual report and could report additional losses.
- Shares of Silvergate Bank fell by more than half to $6.52 in early trade.
On Thursday, several cryptocurrency firms issued statements crafted to distance themselves from the crypto-friendly bank Silvergate Capital, whose shares have experienced a dramatic drop following the announcement that the firm would delay the publishing of its annual report and could report additional losses.
Recently it was revealed that Coinbase, the biggest cryptocurrency exchange in the United States, has severed connections with Silvergate due to the latter’s continuous regulatory issues. This was then followed by a declaration from another stablecoin issuer, Paxos Trust Co. LLC, that it was also cutting ties with the bank.
FTX Effect Still Haunting
Meanwhile, significant organizations like Galaxy Digital, Gemini, and BitStamp have all made public declarations declaring that they have broken ties with the previously critical partner tying them to the traditional banking system. Silvergate said it will assess the effect that these additional developments have on its capacity to continue as a going concern for the twelve months after the publishing of its financial statements before releasing the annual report that had been postponed.
Shares of Silvergate Bank fell by more than half to $6.52 in early trade after the news broke. Similarly, crypto exchange giant Coinbase saw its share price fall by 8% to $59.47.
Even now, four months later, businesses of all sizes in the cryptocurrency industry are suffering under the weight of the market and the stigma of being linked to Sam Bankman-Fried’s doomed crypto behemoth, FTX. Before FTX’s cryptocurrency exchange was even established in 2018, Silvergate was already receiving commerce through FTX’s trading arm, Alameda Research.
