Silvergate Capital Is Shutting Down -- Shares Are Tanking
Shares of the crypto bank Silvergate Capital (NYSE: SI) had dropped close to 31% as of 11:19 a.m. ET today after the bank announced that it is planning to wind down its operations and liquidate the bank after months of turmoil.
Silvergate Capital had provided important infrastructure for the crypto ecosystem, having created a payments network that could instantly clear and settle fiat transactions between two parties on the network at any time. The network was popular among crypto exchanges and institutional traders because crypto trades around the clock, while much of the U.S. banking system operates on a lag.
However, once the FTX debacle played out, things at Silvergate started to go downhill. FTX had been a major client of Silvergate's, and there was a crisis of confidence at the bank amid concerns about whether Silvergate will face regulatory action for its relationship with FTX. The U.S. Department of Justice is investigating the bank.
Source Fool.com
