Silvergate Capital Defies the Odds and Increases Its Crypto Client Base in Q3 2022
Silvergate Capital (NYSE: SI) stock is sinking after it reported Q3 2022 earnings on Monday. The shares fell by more than 20%, even as the digital asset bank said its cryptocurrency customer base continued to grow. The rub? Crypto assets on balance decreased by a huge amount from last year. The company is also delaying the launch of a new blockchain product amid regulatory scrutiny.
Silvergate remains a promising company if you believe crypto will eventually make a comeback. Signs in Silvergate's report point to a lot of big institutional investors believing as much as well. But is this next-gen bank stock a buy during a long and dark crypto winter?
A crypto winter refers to the depressed prices for cryptocurrencies compared to recent highs. With easy money flowing during the zero-interest rate environment of 2020 and 2021, speculation in the young crypto industry was rampant. But now the U.S. Federal Reserve is trying to reel things back in with its aggressive interest rate increases, which are aimed at taming inflation. Higher interest rates mean a lower present value for speculative assets -- especially crypto.
Source Fool.com
