Crypto bank Silvergate is calling it quits.
The company said Wednesday it intends to “wind down operations” and voluntarily liquidate the bank, calling it “the best path forward.”
“The bank’s wind down and liquidation plan includes full repayment of all deposits,” Silvergate added. “The Company is also considering how best to resolve claims and preserve the residual value of its assets, including its proprietary technology and tax assets.”
Silvergate booked a $1 billion fourth-quarter loss and slashed its workforce by 40% in January.
Silvergate more recently shuttered its exchange network, SEN. The stock fell 30% in after-hours trading on March 1 after the company said it would delay filing its annual report with the SEC.
The next day, Coinbase moved to cease transfers to and from Silvergate “out of an abundance of caution.”
“The situation with Silvergate shows just how the contagion effect from FTX continues to rumble on, and how investors’ exposure to the centralized exchange model can blow up,” said Josef Tetek, a bitcoin analyst at Trezor, a hardware wallet company. “When things go bad, that exposure is a risk that is passed on to crypto investors extremely broadly.”
This is a developing story.
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